DOF Group ASA (DOFG) Earnings Call Transcript & Summary

Good morning, good afternoon, and welcome to the DOF Denmark presentation. The plan for the day is that we talk a bit about the fleet. We talk a bit about the market. We talk what our plans are with the fleet. We also want to show you a bit what we are actually doing with the boats. And then finally, we will talk a bit about the backlog and the earnings potential in the fleet. We start with a video here from a project we did in West Africa that finalized a few days ago, where we have 4 DOF [indiscernible] working on the project and have a look at that, and then I'll explain a bit more after we have looked at it. [Presentation]

I hope you enjoyed the video. And I guess the purpose of that video was to -- probably a lot of you know that an anchor handler and what we are talking about here is high end anchor handlers, 250-tonne bollard pull boats. They are, of course, used globally for a lot of projects, more in projects installing as we saw here an FPSO and an FSO. We also use them a lot for subsea -- other subsea projects. And so the point is that for high and anchor handlers with the competence DOF have, the anchor handlers are used a lot on projects globally. And if you look at the economics on these projects, we had the average rates on the boats into the project. And of course, then that was project margin on top, we had average rates above USD 65,000 there, and covering done in third quarter and most of fourth quarter 2024. So I come back to it, but -- so I guess what you need to understand, of course, is that DOF needs a certain number of anchor handlers to serve the global project market, yes. So we don't own anchor handlers to trade the spot market. We own anchor handlers to work on projects. And the prospects going forward for projects in the mooring space, '25, '26 looks very promising. So we expect to be busy with quite a few of the DOF Denmark boats on projects in the next few years. This is what we bought. You probably have seen it before, we bought 22 boats, average age of 8.5 years. And done CSVs, anchor handlers and unbond cable layer. Later on, we will go through a bit more in detail boat by boat, but in summary, this is a high-end fleet. It's a young fleet and a very capable fleet. So of course, next slide shows what we paid. And we paid an enterprise value of $881 million for it, which is at closing was 0.66x of the asset values based on broker values. And since that, the values have continued to increase. And of course, that is due to the very strong underlying market yet. So like the 4 biggest CSVs we have [indiscernible] boats, they have no broker values north of $150 million. So meaning that only those 4 boats represent more than $600 million out of the $881 million we paid. So we -- on values, we think this was a very, very good and attractive transaction. And of course, why did we do it? Of course, the fleet has enabled us to grow immediately and adding core both for us, what our strategy is high-end anchor and high-end CSVs, yes. So the plan going forward, of course, is to get them into our system to install subsea equipment on some of them and then put them into our commercial model. And of course, we expect then earnings to -- at least when we come into second half '25 and into '26, that they will be on same levels of our own fleet. So that is the background why we did it. And as I said, we still believe this was -- on asset values was a very attractive acquisition for DOF. Next, please. So this is the fleet. And I know you -- I try to not spend too much time on it, but I think it's important that you understand the quality of the fleet and the potential of the fleet. The first one here is a large cable layer, it's called Skandi Constructor. So it's purpose-built cable layer. And our view on the market is that the cable layer market, which for bottom fixed wind, for instance, is probably the hottest segment in our space. There is the growth or the demand side will grow a lot. And we also expect the rate levels and the project margins in that space to increase. So we, of course, we will see what is the very best way for us to maximize value out of that vessel. Then you see we have 4 higher class we call them implement the installer inventory in Volvo. That is the newest and most modern large subsea construction vessels in the world fleet as we speak. They are built, as you see in '17 and '18. And very capable 400-tonne crane vessels. So it's high -- really, really high-end CSVs. And of course, the earning potential on them are very good. If you compare that to what we are able to do with similar boats in our own fleet, there is a huge potential on the earnings side on those 4 boats. What we are planning to do with them, of course, is to install ROE subsea equipment on them and of course, then not only get the vessel earnings on them, but then get the subsea margins on those boats as well. Then you see the backlog is -- so it's short-term backlog on all 4 boats. And we think that is a very good position. And we will talk a bit about that later on, but we do believe that the market going forward will be strong and we expect rate levels to increase. And of course, the present rates they are on, of course, are well below today's rate levels, yes. So even without a further step-up in day rates for these type of boats, there is a huge earnings potential increasing from '25 into '26. Next page shows the order CSVs, which is the Asserter 250-tonne crane boat and we just commenced a contract, of course, a very nice rate, reflecting today's market level yet. Then you have the Skandi Forza. We renewed just a few weeks back and the rate from mid-'25 is on market. So it is a very nice rate on her as well. So I'll leave that like that. And then next, please. And this is [indiscernible]. So we have 2 [indiscernible], Mariner and Master in Brazil, just for a short-term project. It's very bad earnings. It was part of the deal that we have to do that project for Maersk before we take them back. So -- but from April onwards, they will be in the market. And then we have 3 boats all going to Canada and 2 of them are new contracts, and they have an average EBITDA annual somewhere in the $9 million. So a bit USD 9-plus million per vessel per year. And then we have, I guess, the next one. Then we have 2 boats in Canada as well, Cutter and Clipper. And worth mentioning here is that the Cutter contract ends on '25 and then that means that there will be quite a different earnings [indiscernible] commence a new contract. Then we have the spot fleet, which is in total 6 vessels. And worth mentioning, and I'll talk a bit more about that later on the Anchor Handling market. But some of you might know that we -- there is a big Anchor Handling tender in Brazil that was delivered in on the 16th -- and the first auction for the first lot, the 250 tonne per lot with ROVs were done yesterday. And interesting to note is that on that tender on that lot, the only bidder was DOF with 6 vessels, meaning that we bid a few of the DOF Denmark boats on that. And of course, it remains to be seen where it ends. But of course, the -- let's say, the starting point is very promising. And we -- of course, we do expect, we can't promise, but we do expect, of course, to place quite a number of boats on that tender. And we also expect the rate levels to be at least on the same level as the tender that we did last year and perhaps also to see an increase. And as examples, on the previous tender, we did the Skandi Amazonas. We got a rate in the high USD 70s a day. And we did 2 a bit smaller boats similar to the Laser, Lifter and Logger, and they had the rate in the high 60s. So meaning that you probably are talking about on those tender, I'm not saying that we will do repeat it. But if you get the same level, the operational EBITDA, 4 similar boats are Laser and Lifter were in the 40s -- low USD 40,000 a day on that tender. So it's worth mentioning and of course, when people look at the Anchor Handling market, they look a lot on the spot market North Sea, which is going up and down. But worth mentioning what you need to remember is that the market for high and anchor handlers are a global market and the term market globally. So I was mentioning Brazil. There was recently done fixtures in Asia Pacific at the same high level, yes. So the term market for anchor handlers are strong. And our plan, of course, is to reduce the exposure in the spot market. We will do long-term contracts on 2 or 3 of them. We likely will try to sell the 2 smallest boats in that fleet, the T-Class. And then we will use 3, 4 boats on the subsea projects globally. So this is not a spot play. This will be a combination of global projects and winning a few long-term contracts. Next, please. So here you have the backlog summarized on one page. And as you see, it is kind of 13 boats total fleet of 22 that is green or partial green. So let's say, if you look at both years, perhaps 12 out of 22 years [indiscernible] '25. And as I say, especially first half '25 will be what you can call a transition year where we will take the opportunities to install our subsea equipment on them. And of course, that will enable us to use them on subsea projects and IRM work and long-term subsea contracts globally. We will also, of course, then install some ROVs on few of the anchors handlers to enable them to also support the subsea side of the business. And of course, why do we do that? We have showed you example of that before. I think we had a slide in previous presentation on the Skandi Installer that we have had on charter from April this year. And you saw that we were making around $1 million a year on top of what we pay on the charter. And of course, that is the plan for the 4 oil classes. It's also a plan for vessels like Nexus and Nomad, where we have -- they are on contract today, there is an other supplier of the subsea services. So of course, our plan, of course, is to see if we can replace those and add extra earnings on those vessels as well. So on this, you see we are saying from the green the firm contracts, which is then roughly 12 boat years. We expect USD 125 million in EBITDA in 2025. And then we are left with 10 boats [indiscernible]. So of course, then the question is what is the earnings potential for the other 10 boats. And we will give you a guiding later on and of course, talk a bit more about that later on. What also is very interesting is that, as you see from the bar here is that there is only a very few legacy contracts not ending in '25, yes. So keeping in mind that the Fox says in a new contract, the Minder Mobiliser and Mover are on new contracts. We are talking then Nexus and Clipper that are the 2 ones that are really on legacy contracts, yes. And that, of course, means that when we get market rates on this fleet, when we are able to add the subsea services, when we are putting these on the anchor handlers on projects, when we are putting some of the anchor handlers on these term contracts. Of course, the earnings potential for this fleet is much higher. Already in second half '25, we expect the run rate to be on the north side annualized above $200 million. But of course, we expect that to increase considerably going into '26 and onwards. So -- and as we have said before, when we have presented, of course, this is part of the reason why we did this acquisition. We get a very modern fleet. We have a backlog that is short that can be renewed on market terms and we can add services on top. And that together done with a very attractive acquisition price, we think it's a perfect plan in what we deem to what we believe is a very strong market. Talk a bit more about the market, but we -- our view on the market is that 2025 looks good. We have good tender activity. We have strong leads on most of the boats and then '26, '27, we see clients. We have never seen clients being so early for business as we see for projects now in '26 and '27. And of course, that tells us what the clients expect. They expect the market to continue to go in our favor. So I'll leave this slide like that.

Mons, just to jump in and clarify. You said on the Installer that it adds $1 million per year, but I believe it should be per month.

Yes, per month, per month. $1 million per month. Sorry. Thank you very much. That's a big difference, yes. Per month. And what I also forgot to say is that there is a possibility to ask questions, yes. So you can ask questions and then we will answer them at the end of the session. So there's Q&A., so please. I forgot that as well. So please send your questions in and we will do our best to answer then. So $1 million per month. I'm sorry, I do -- so then this year have also shown before, it's -- so I don't spend much time on it. It's a 15-year contract, a new build 15-year contract with Cenovus investment-grade oil company in Canada. It's 7- to 7.5-year payback, and we expect to financing it with a very limited amount of cash. So our dividend ambitions short term are unaffected and long term, we expect them to actually increase by this vessel. So I leave that like that. I've talked about that before. So then we are on the guidance. It is -- so for the DOF Group, it's a bit longer range than we normally have. And of course, we normally guide in February, not no. So this is not what I would call a guidance. It's a preliminary indication for 2025. So what we say is that we expect to deliver somewhere between $720 million and $800 million in EBITDA for the DOF Group in 2025. We will, of course, give more, let's say, we will come back on the guidance as we normally do in February next year. And hopefully then, of course, we can narrow it a bit and we have -- and then on the DOF Denmark part of it, we expect somewhere between $150 million and $200 million in EBITDA. And as I said, then with higher -- much higher run rate in second half than in first half, and I explained to you why that's the case. And then you saw, of course, 12 out of 22 vessels are sold. So that means that 10 out of 22 are not sold. And of course, there is risk in that, and that's why we have this wide range. And then hopefully, we will be able to narrow that as we expect to do a bit of contracts between now and February when we give the accurate guidance. So we will come back then in February, but this is, let's say, a preliminary indication yes, so at least to show you the direction. And the next is really -- the key takeaways, what we would like you to remember from this session is that the DOF Denmark fleet is a high-end fleet acquired at what at least we think is a very attractive price. The backlog for the combined group is very strong for '25, and we have continuous high tender activity globally -- globally, I'm saying globally, all from APAC to North America to Brazil to the Atlantic Basin. Then what is -- I would call it perhaps not surprisingly, but not normal at least is that we see clients coming to us very, very early and much earlier than normal for projects and contracts for execution in '26 and '27. And that we do believe it is a very good sign for the market in those years yet. And if you combine that with looking at the backlog for the Tier 1 subsea players, I think that is a very strong indication and that's why we believe that '26, '27 will be even better than what we have seen in '24 and expect to see in '25. Then there is only 3 legacy contracts in DOF Denmark beyond 2025 and combining that position with the market expectations is very interesting. And that's why we are saying we expect the earnings from DOF Denmark to really kick off when we get closer to 2026. Then what are DOF doing with our anchor handlers. If you look at the old DOF anchor handlers, they are all on long-term contracts apart from 2, which is trading the project market. We have the Skandi Skansen and Skandi Hera trading the spot project market. And I think the Skandi Hera have done 1 rig move in the North Sea in 2024 and that was a job when we came back from West Africa that we are doing as we speak. So one rig move. The rest of the time, she's been on projects. And likewise with Skansen, we had not had a single day in the North Sea spot market. So that's the plan for the anchor handlers. And as I said, the Tier market for high end anchor handlers is very strong. The recent rates on term in the North Sea has been good. The recent rates in the APAC market has been good. And the recent tenders in Brazil has had good rates. And as I said, on the 250-tonne ROV lot on the present tender, only 1 bidder DOF with 6 boats. And then we have to see how that pans out. There are lots being an auction tomorrow and the day after, not on the tomorrow and the day after and into next week. So we will see the outcome, but we expect limited competition, and we hope that the levels on that tender will be higher than what we saw on the previous tender. So as we write, we have a unique position for global modern projects, and we need somebody DOF Denmark anchor handlers to execute these projects because we have fixed. So we have positioned ourselves for this. We fixed the DOF Denmark anchor handlers long term to make space for the DOF Denmark anchor handlers. And then the earnings for '25, the first half will be a transition year where we transit, where we install ROVs, where we win new contracts. And then from second half will be stronger and we expect annual run rate in second half north of $200 million. And then we are saying the earnings potential for '26 and onwards is higher due to much higher rates in the market today than what we had in -- on the legacy contract and also then adding the subsea services will give a higher earnings potential. So that was the presentation. So thank you for listening. And now we are open for Q&A. And I guess that is like you send them in, in writing and we read them and try to answer them, yes.

Yes, that's right. So please feel free to continue to send in many questions. We have received quite a few already, and we'll attempt to get through as many as we can. And sometimes we might combine some of the questions that are similar in nature that you have sent in. Starting first then with the guiding for DOF Denmark of $150 million to $200 million of EBITDA, does that include the negative one-offs that you mentioned? And do you have a breakdown for those negative one-offs?

That was a difficult question. So what do you mean? It means that when we stop them and install equipment?

Yes.

Yes. That, of course, includes that, yes.

Yes. And I don't believe we have a breakdown to provide on that at the moment. Furthermore, how can you be so confident that 2026 will be much better for DOF Denmark?

How I can be so confident? Of course, you can never guarantee anything on this planet. But why I'm confident is, of course, that if you look at -- take a few examples. If you look at some of the high class, couple of the high class, they work in with the day rates today in the 70s. So mid to low 70s and per day U.S. And of course, the present market, of course, is much higher than that. And then, of course, also we expect the demand to further increase. So even if we don't decrease, of course, there is a much higher earning potential than the mid-70s they are earning today. And then if you add -- if you believe in that we are able to add margin on top, as we mentioned, you corrected me $1 million a month. Of course, then that's why I'm confident. We just have to do what we are doing already on the rates that is in the market. And then I'm confident that this will -- the earnings will increase a lot. And of course, the same if you take Maersk folks, the old rate today is $20,000, $25,000 lower than the rate -- the new rate. If you look at the Connector, the options for '26 are probably around $10,000 higher a day. If you look at the bonds going to Canada, of course, the spot market, they have -- earnings they have got this year, of course, is much lower than what we expect from the new contract in Canada. So I can take it boat-by-boat, but I guess you understand where I'm coming from. This is then just saying that a lot of the contracts are not at market level and we expect to do them do new deals on market level, and we also expect the market to further increase and then adding services on the CSVs and also services on some of the anchor handlers.

And on the Anchor Handling, a tender that you mentioned in Brazil. Just to clarify, is it the case that you were the sole bidder for 6 unique lots with 6 vessels?

Yes. There is there is, let's say, 4 different lots. So it's 250 tonnes with ROV, it's 230 tonne with ROV, it's 180 tonnes with ROV and then it's a 270 tonne without ROV. And then you have 230 tonne, 250 tonne and 180 tonne without ROV. So the first lot here, which was the highest priority for Petrobras was the 250-tonne lot with ROV. The only bidder on that lot was DOF with 6 boats. That was 4 of the Norskan boats already in Brazil and then 2 of the DOF Denmark boats that we have shown in this presentation. And then, of course, then the 230 tonne ROV will be bid. And we don't, of course, expect to be alone on all these lots, but we expect not a huge number of competitors. And I think that shows, of course, that the ownership of, let's say, 230 tonne, 250 tonne plus bollard pull high-end anchor handlers are not very fragmented yet. There are not that many owners in that space. And we also saw that in the last tender that it was very disciplined on the bidder side. And then also adding a few of the owners of that high-end anchor handlers, they do not have operations in Brazil.

You mentioned adding subsea services a few times in the presentation. What does that entail in terms of investments on your end in additional equipment and potentially, people?

Yes, of course, it's -- and of course, we will guide the CapEx when we come to February when we give full guidance. And -- but you say, let's say, if you use one of the big CSVs as an example, I think you're probably talking, roughly speaking, $8 million, $9 million to put on all the equipment you need. And then for [indiscernible], of course, it will be less because normally on those, you have 1 ROV instead of 2.

We saw yesterday Novo announcing a grant of NOK 300 million for 2 potential PSV newbuilds. Could you elaborate a bit on your thinking in relation to that?

Yes. Of course, the starting point is that, of course, we did participate in that Equinor tender. And -- but the purpose of participating was to learn and to be on top of, let's say, the future fuels and the engines and learn the technical side of it. And then we bid it on a rate that was very high. And the intention, of course, was not to be on any shortlist. It was to learn and see how -- what we could get out of it. And then suddenly, we got this support. And of course, that puts us in a position where we might be and I don't know if you are, you might be on a short list, but I don't know about that. So I have to say if it's possible to win 15-year contracts with those days we have offered, it will be a fantastic investment. But I don't know if we are on short list and I don't know if Equinor will accept our rates. And -- but I know that the guys have done a tremendous job on the technical side and meaning giving -- putting us a position to get these subsidies. But I think it's far too early to put any to, let's say, to talk about whether we are in a position to win or not win or whether we want to win or not win and -- so it's too early. We got these grants and that's where we are. And we didn't bid to win, we bid to learn and if we win with those rates, I guess we have what we can call a luxury problem.

We have seen relatively few subsea contracts awarded to the...

Perhaps just one more comment on Equinor -- of, let's say, if we win, of course, then, of course, it will have no impact on the cash position in DOF. It will be, as we say, on the Cenovus contract where you have payback in 7 to 7.5 years. Of course, then if you win and hopefully, the economics on the Equinor deal will be a bit better than the Cenovus, then of course, you will finance this close to 100%. So it will have no impact on the cash position if we win but as I say, I have no idea whether we win or not and I have no idea whether we want to win or not.

We have seen relatively few subsea contracts awarded to the subsea vessel owners in H2 of 2024 compared to the previous periods in '24 and '23. Could you share your thoughts on why this is?

Of course, it is... and it's always like that. And I can only -- I can mainly talk for us. It is the contract common periods. So it's periods where you get more contracts. And you saw DOF had until, let's say, August, September, we had a very high order intake. So we had a book-to-bill that was the highest ever. And then it's been a bit slower the last few months. And of course, that is also partly due to that the old DOF fleet were kind of had a very high booking for '25. What we see now is that the tender activity has increased again. We also see -- and that's also to fill the gaps for '25 and then into '26 and '27. So my -- and of course, I can't -- this is more feelings than anything else. But of course, I expect to see tender activity continue to increase and then, of course, also then awards to announced awards to also increase, yes. So of course, I do once a week, I have all commercial guys globally from APAC to Brazil to North America and Africa and North Sea. And we have the schedule for all the boats. So we have good leads and a good plan for most of the fleet here. So I -- and of course, the focus lately has been, of course, to fill the gaps in quarter 1, and you saw the DOF Denmark fleet. But if you look at the DOF -- the old DOF fleet or the red DOF fleet or what you want to call it, of course, there are -- I think we counted out of that fleet where we have, let's say, commercial responsibilities for 50 boats. I think we had in total 4-5 months available in quarter 1. So that's 5 months out of 15 months. And of course, that tells you -- it's also part of the reason why the order intake has been a bit slower lately because, of course, it's been more and more sold out. And of course, normally, if you fix first quarter, the year will be good. So -- and then we, of course, have a few leads to fill some of those 4, 5 months. So as we said, for the DOF side, the old DOF side, of course, the backlog for '25 was the highest ever. And of course, we -- of course, you see on the guidance here preliminary guidance for the group, of course, shows that the preliminary guidance then for old DOF shows a fairly decent increase in EBITDA compared to '24.

Right. And then a few questions around the dividend, the guidance and your thinking around that, especially in light of the CapEx required to upgrade vessels. Do you foresee any changes to the communicated dividend guidance in light of that?

No. And of course, it's -- and I think that is very important that there is a big difference between CapEx and cash -- and when we -- as we say on the new build Cenovus, that will be financed. So even if the CapEx is high, the cash will be very limited. And on the subsea equipment that we have, of course, most of the equipment we have is paid on the existing equipment. And that is owned in a company called DOF Subsea ROV. And so what we do on those -- on those new ROVs is that we finance them 80% and we pay floating interest plus 2.2% in margin, yes. So there will also be a limited cash drain on that subsea CapEx. So that means that the dividend we have guided on will be -- will not be -- we are not changing any guidance on the dividend. And I guess a follow-up question is how the refinancing is doing. And that is that we are, let's say, in advanced discussion with the banks and moving nicely along, and we expect to land that in quarter 1 and be then in position, as we have said previously, to pay dividend in for quarter 2. So there is no change on that. And then, of course, at the same time, we are -- we also have the same range on where we want to be... on the -- on the gearing level, yes, between 1.5 and 2. So there is no change on that. And I guess the keyword here is we have to talk about -- when we talk about dividend, we have to talk about cash and not CapEx.

Thank you. There are some people who noticed a call out on the Skandi Implementer receiving the payment situation there. Are you able to share anything more about that situation at present? For instance, when was the last time you received payment? And what are your options if the situation persists?

So of course, we -- there is no payment default on that contract. We have been paid so far according to the contract. And that means that we are paid -- so the October hire were paid in November and then the November hire will be paid in December. And November hire is not due before in some days. So there is -- so we have been paid up until now in accordance to the contract. And of course, we are not experts on Mexico, of course, DOF have not had boats in Mexico. This is the only boat we have. And of course, we noticed that there is payment problems in -- from [indiscernible] and, let's say, down the value chain. And I guess if we are not getting paid, we will act according to the contract. And of course, we will not stay in Mexico for a long time if we don't receive any money. And as I said, when we did -- I mentioned a few rate examples on the high class. I think I don't know -- remember the exact number, but I think the rate on that implemented in Mexico is in the low 70s. And of course, we -- if we get it back, of course, we will install ROEs and hopefully get her on contract that yields much higher than 70,000 a day. It's never been a plan for DOF to stay long in Mexico with that boat. It is not built for the scope being executed in Mexico. It is built for subsea work and not topside work. So the worst case, of course, is that we have -- as I said, we have been paid end of October. So the worst case is that you get some idle time in the next couple of months. And then we go and have the ROVs ready and start looking on the DOF commercial side. But as I say, I don't know in Mexico today, but -- so that remains to be seen. So far, there are no payment defaults on that contract.

Okay. And then in relation to new builds, do you expect that there will be enough high-end CSVs in the market to cover demand in 2027 and forward? Or do you anticipate that new builds for the high-end CSV segment will be on the table at some point? And in relation to that, could you talk a bit about the general view on new builds?

Yes. Of course, it's -- of course, we will not build any boats on speculation. As we said before, if we can do a 12-year, 15-year contract, and finance that with a USPP or similar with 0 or very limited cash. And let's say, with a payback done of 7 years roughly, we will look at that, but not build on spec. And of course, to build -- and I don't know what is meant by high-end CSVs. If you define high-end CSVs as 400-tonne crane vessels and then, let's say, before high classes and Skandi study and the pipeline in Skandi Africa, I don't expect people to build those on spec. When we built the Skandi Africa got in 2015, she was costing $300-something million. And I do expect that the boat like that is with that equipment on is $500 million plus to $2 billion. So I don't expect to see any big numbers or new orders in that class. Where we have seen orders is in the 150 tonne to 250 tonne crane segment. And of course, we see from Norwegian yards, the pricing is reported to be $130 million to $140 million. And then if you add finance through construction, supervision, blah, blah, blah, you're probably $150 million plus. And of course, it is borderline economics on today's rate level to defend that. But it could be -- if our market is correct, it could be -- it could end up not being a disaster. And -- but of course, it's difficult. What we've chosen was to do this acquisition and get earnings today. And of course, nobody knows who the market is in 2030 or '31 or '32. So I think for me, it's too high risk to all our subsea boats on spec. And of course, it's none of the subsea players, of course, have backlog today to defend taking a vessel like that on long-term charter. So I expect it to be limited numbers. And -- but of course, if the few that has order boats have made -- if it's proven that they have made a good decision, then I'd rather buy shares in DOF. As we see, we are buying these boats for at much lower pricing. We have a much bigger fleet, and we are priced at 4x or whatever we are priced on today's shares price. If they are right, of course, the DOF will be a cash for many, many years. So I guess the answer to that is do not order boats, buy shares in DOF because then you get a much better subsea exposure than to order a boat or 2. And just a final comment, sorry, is, of course, that in that 150 tonne to 250 tonne space, that, of course, is where we have -- I think we had around 15% of our fleet value in that space. So it's not a large portion. And it's also where we have most of the chartered in boats in that space. So it also means that if you take the charter [indiscernible], there is one answer to this. If you take the shipowner on, there is another one, yes. But of course, if -- today, these boats can also be opportunities for us to charter in and place on contracts like we did with Havila Phoenix and [indiscernible] so on.

And then on the other side of the spectrum, namely vessel sales, is that something that you're actively pursuing? And if so, in which segments are you focusing on that?

So we are actively pursuing that. So we are actively pursuing that on 2, 3, 4 of our smallest anchor handler. We are actively pursuing that on some of our oldest and less capable CSVs. And of course, the anchor handler we sell, of course, because they are not core. The CSVs we sell because, of course, it's never wrong to take -- to do a good sale in a very strong market. And then we, let's say, opportunistic, we look at selling more core vessels if the prices are what you can call -- I would call it, very high. So we have -- so we are chasing a few and then we have the door open if the price is good enough. And we have said before that our plan is that the old fleet is now 65 boats that if we get it the way we want it, that fleet is closer to 60 boats and 65 boats in a year from now. So -- but of course, you now a time sales that you have to take the time needed to get the price you want.

Thank you. We'll have to round up soon, but we'll take 1 or 2 more questions before doing that. We have one here. Should we expect the available vessels to be out of work for H1 of '25? Or will they operate in the spot market until you have completed upgrades, et cetera?

Yes. And of course, that is really the same answer as with the sale of boats. You, of course, cannot time the contracts both solely yourself. So I think it will be a mix. You will see a mix where there some of them go direct on contracts and some of them will have to install equipment.

Great. And then finally, can you explain why the spot market is so weak and the term market is so good?

Yes. And of course, I focus on the anchor handling market then. And of course, the Anchor Handling market in the North Sea is kind of a perfect market, where if you have a few boats less, it's a fantastic market. You see it -- you can start the week with 10,000 pounds a day and end the week with 100,000 pounds a day. So it's very perfect supply demand. And then, of course, when owners don't have any place else to go, they go to the North Sea. And why the term market is strong. It's because you have to -- number one, you have to -- that tells, of course, who the owners' expectations are, when they -- even in, let's say, fluctuating spot market choose to bid term deals at a high level. That's -- and of course, also it tells also that when the charterers are willing to pay these high rates, it tells where both the supply side and the demand side expect this market to go that this will go stronger and stronger. And then of course, it is also a bit more complicated than that because it's not what you can call 100% fair market because some owners, they do not have placing power globally. Some owners do not have engineering, some globally, some owners do not have rampant capacity to import in Brazil. And so it is -- I think to maximize the earnings potential on these ports, you need all of that. You need a global placing power. You need to work these boats in both the anchor handling market, but also on the subsea side and you need to be able to execute projects globally with them. And I think this Brazil anchor handling tender is very good examples. So what we are bidding here is the 250-tonne lot, which is with ROEs. So you need the ROEs on the boats. It is in Brazil. So you need -- you don't want to go to Brazil not knowing what you are doing. So you need a setup, you need a history and a lot of people have burned themselves. So it's a lot of explanation to that. But -- and of course, if you go to Australia, it's also the same. So there might be 7, 8, 10 different anchor handling owners in the North Sea right now. But then when you bid in Brazil, there is perhaps 2 or 3. When you bid in Australia, there's perhaps 2 and 3. So I think that is the main explanation. And then I think the final word is, of course, that if you look at the award we got from Equinor [indiscernible]. So we had a rate of vessel only, not including ROV around NOK 500,000 a day on that boat. And of course, the bids as low as NOK 400,000 a day, but it's also on the spec on the boats. So it's -- and I can give you talk for an over about the different way of specking and anchor handler, but I'll not do that. It of course an anchor handler, it's not an anchor handler. It's a lot to do with the trust with the deck area, with the winches and all the equipment. So it is -- and of course, that's also -- and of course, it's also done the track record of the owner of the boat. So it's there's a lot of answer to that to why the term market is stronger. And of course, it's a lot of the anchor handlers in the spot market that don't qualify for bidding on 230 tonne, 250 tonne high end anchor handlers. And of course, the spec for the boats going to Brazil requires very good winches, a lot of storage, they require very good deep plot and so on and so on. So it's not something you can answer in one day, but I hope at least it gives a flavor why an anchor handler is more in one system than the other and why an anchor handler is not an anchor handler is a lot of difference on the specs on these anchor handlers.

Yes, that's great. And that about concludes what we were able to get across in the Q&A session for this time. So thank you, everyone, for listening in and for providing your questions.

Thank you very much. Thank you.