Precious Shipping Public Company Limited (PSL) Earnings Call Transcript & Summary

[Foreign Language]

Thank you, Som. So let's start with the presentation on the industry side. And here, you can see clearly that China in the first 9 months of this year has really outshone everything that is available in the dry bulk market. So if you look at China's iron ore imports in the first 9 months, it was up by 4.8%. If you look at China's coal imports, it was up by 12% and likely heading for a 500 million metric tonnes number by the end of the year. China's steel production was down by 3.8%. The average steel inventory is the same. There's no change since last year. In the 9 months, steel imports were down by 9%. But remember, this is a very small number, makes no difference it's 5.2 million metric tonnes versus 5.7 million metric tonnes. Steel exports, of course, on the other hand, was massively up by almost 20%. And if you look at last year, it was already up by 32%. So it's really growing at a good pace. Steel consumption in the 9 months, of course, was down by 6%. If you look at the average of the last 5 years, that is 2018 to 2022, both years exclusive, you will see that the average steel consumption per annum was 953 million metric tonnes, compared to that in 2023, the consumption level was at 971 million tonnes or plus 2%. So steel consumption is growing rather than falling if you compare it with the last 5 years. So despite the slowdown in the property sector, what has China done to make steel consumption get the least amount of an impact. And if you see that, you'll see that the government has focused on alternatives for steel consumption by infrastructure and manufacturing. If you look at steel exports, as I said, it grew by 32% in 2023 and now has grown by another 20% in the first 9 months of this year. If you look at steel exports from China in January to September, it goes to an 8-year high. If you look at the electrical cars, ship construction is doing really well, and it is supporting steel consumption. Just by the way, China is today almost 70% of the entire shipbuilding market. If you look at Q1 for this year, normally Q1 is a very weak quarter, it was much stronger than anticipated. And therefore, if you look at the seasonality for this year, there is not much of seasonality at all. If you look at the Pacific market, thanks to China's very strong imports and exports. It has benefited hugely the Handysize, Supramax and Ultramax sector of the market, which is where Precious Shipping is located. If you look at the data that Clarksons gives you on what is driving imports into China. Since 2022 -- since 2020, it has been driven more by the price of commodities rather than by requirement of commodities. So for example, if you look at 2020, imports were up 9% because low prices were there of commodities as the rest of the world shutdown during COVID. In 2022, volumes slumped, why? Because of the Russia-Ukraine war, which made commodity prices soft, as commodity prices went up China stopped importing or slowed down their imports dramatically. As prices dropped by almost 20% between September 2023 and in September '24, imports hit a record 4.6 million metric tonnes in 2023. If you look at imports to China, they have reached USD 222 billion in September 2024 and it's up 2% month-on-month, up 0.3% year-on-year. So the trend of low commodity prices and high imports into China continues. Iron ore imports in October '24 is likely to reach 120 million metric tonnes, if it does that, it will be an absolute all-time record. So past all-time record has been 112.7 million metric tonnes in July 2020. If you look at steel exports in September 2024, it was up at 10.2 million metric tonnes for the month. So it's up 7.4% month-on-month, up 26% year-over-year, taking year-to-date exports to 81 million metric tonnes or 20% above year-on-year. So strong growth means demand is picking up in the rest of the world for steel commodity. And China is expected to end 2024 with a growth of over 20% in exports at around 110 million metric tonnes against 90 million metric tonnes in 2023. But then if you look at the overall trade in dry bulk in billion tonne-miles, you can see that in 2024, it's expected to be 4.41%. Against that, there will be a growth overall in the dry bulk fleet of 3.2%. If you look at the prospects for 2025, it's going to be 0.68%, in terms of the change in trade is going to grow by 0.68%. And against that, you have a change expected in the dry bulk fleet of about 2.9%. If you just look at minor bulks and look at their tonne-mile growth in billions of tonne-miles. And if you look at the percentage growth, you can see that in 2024, minor bulks are going to grow by about 3.6%. And in 2025, it's going to grow by 2.4%. Against that, the change in the ships that is the increase -- net increase in ships in the geared sector would be 4.3% for 2024 and 4.2% in 2025. But please don't get alarmed by these figures. As you can see all here, growth of trade in 2024, as forecast by Clarksons has changed quite significantly from the time they started out in January 2023, saying it will be 2.02% overall trade and 2.82% increase in minor bulks. And now finally in October of this year, for this year, we are forecasting 4.41% increase overall in trade and a 3.59% increase in the minor bulk trade. So again, Clarksons, with all the resources that they command, are not able to forecast with any clarity really what is going to happen in any one year in terms of the tonne-mile trade demand growth. Similarly, if you look at the freight growth, if you look at the January addition for 2023, forecasting fleet growth for 2024, Clarksons had overall fleet growth of 0.3% and with the geared ships going at 0.6%. And by the October '24 edition for the same year, they're showing an overall growth rate of 3.2% with the smaller ships or the geared ships growing by 4.3%. So again, as I said, Clarksons are not able to forecast neither the demand side, nor the supply side with the need real clarity. So coming to 2025, it seems that the predictions made in January 2024 have now shrunk down from 1.58% on the overall tonne-mile growth for dry bulk to 0.68% in their October edition from the January edition. And if you look at the minor bulk, it has grown -- or rather it has shrunk from 3.22% to 2.39% in mid-October edition. Similarly, if you look at fleet growth in the January '24 edition for 2025, overall fleet growth was supposed to be at 1.1% with geared ships growing 1.8%. Instead of that, you see that in the October edition, the overall growth in the fleet is pegged at 2.9% with the geared ships going at 4.2%. Coming to commodities and how they have distributed or carried by the various size sectors in dry bulk. You can see for cape -- example for Capes, they spent 74% of their time carrying iron ore, 16% on coal and 10% on minor bulk, and that minor bulk consists mainly of bauxite from Guinea. If you then look at the surplus -- Supramax and Handysize, you see that our concentration is in minor bulks, 59% of minor bulks is -- Supramax is carrying 59% of minor bulks in terms of time used on it. And Handysizes are spending 63% of their time on carrying minor bulks. So for us, minor bulks are more important. And if you look at the overall fleet growth in the first 9 months of this year, you'll see the following. First of all, that there are 40,074 ships in the world fleet. The average age of the world fleet is 12.21 but if you look internally and look at the geared ships, the geared ships have an average age of 12.58 years, and the younger fleet is at 11.74 years, is at the Panamax and Capesize sector. If we then look at the total deadweight rate, it's crossed 1 billion tonnes mark. And if you look at the average deadweight per ship, it's almost at 73,000 tonnes. If you look at the growth in the last 9 months, you would see that in the 9 months for 2024 geared ships have grown by 12.78 million metric tonnes. And for the gearless ships, they've grown by 12.81 billion metric tonnes. So you can see more or less, it is all at the same level, they're growing at roughly the same speed. If you then come to the next slide and look at the total order book, it's at 98.66 million deadweight tonnes, which is 9.65% of the existing fleet. And if you compare that with the 20-year old fleet as of today -- as of the first of October, it is at 9.45%. So not too much growth in the order book to fleet ratio compared to the 20-year old similar fleet. What is interesting in this slide, of course, is that in 2009, the order book-to-fleet ratio had reached a gigantic 78%. If you then compare the various periods of time, 2003 to 2009 as the boom years, 2010 to 2020 as the very low years, then 2021 and 2022 as a mini boom and 2023 as a bad year and then the 9 months of 2024. So if you look at that, and look at, say, for example, the annual average demand in billion tonne-miles, in the first column, you can see it was growing at 5.5% per annum. In the second column, you can see it has dropped quite sharply to just 4.3% per annum. And in '21, '22, it has dropped to just an average of just 1.5%. And if you look at 2023, it grew by 4.7%. So a very good year in terms of tonne-mile demand growth was there for 2023. And in the 9 months of 2024, we are estimating by Clarksons that for this year, it will grow by 4.41%. If you look at the speeds on the other hand, speed has dropped from 13.5 knots down to 10.9 knots in 2024. So it has dropped almost by 2.5 knots. Keep in mind that every time the world fleet drops 1 knot of speed, it means that the supply side is shrinking by 5.5% so long as the ship sail at sea for maximum 250 days. If it goes beyond that 250 days in a year for sailing time, then the percentage of the fleet being removed because of the slower down -- slowing down the speed will become even larger. If you then look at the growth rate of net supply at the start of each of these years in this chart that we have. So in the first period of time, it was growing by 6.8%. So very healthy fleet growth during the first 7 years of this period that we're looking at. And then in the next 11 years, it was growing by 6.4% per annum. So again, a very strong growth for a very sustained period of time. When you look at 2021 and 2022, growth rates have gone down to below trend at 3.3%. And for 2023, growing at 3.1% and for next -- for this year, it is expected to grow by 3.2%. Now the interesting part is, again, as I said, that even in 2024 at the start of the fourth quarter, the average over fleet ratio for forward book or forward ordering of fleet compared to the existing fleet was at 9.65% against an old age or a 20-plus year fleet of 9.45%. So effectively, supply for the next few years should be relatively benign. This just gives you the same chart but showing it in a separate format for the various periods of time in terms of the speed. This gives you the congestion in each of this year. You can now look at 2021 and 2022. And you will get a feeling that the cost of high congestion in these 2 years, we did very well in terms of the earnings per day per share. And if you look at our profitability, if you look at 2021, we made $137 million net profit for that year. If you look at 2022, we made $139 million net profit. And then if you look at 2023, you see that congestion is starting to ease off. And in 2024, that easing off has been, again -- once again, looks like it's coming back. If you look at 2023, despite the very strong growth in tonne-mile demand of 4.7% as against a fleet increase of only 3.2% we still did quite poorly in that sense when compared to '21 and '22 because we only made $20 million net profit in that year. Right now, if you look at our net profit and just extrapolated basis, 1 quarter additional just an arithmetic exploration, we should be at more than double the level of profitability for 2023. If you look at this chart, it shows you how the BDI has changed in the 9 months in 2024 compared to 2023. It was up by 58%, if you look at comparing with 2022, it is down by 11% and compared with 2021, it is down by 33%. So you can see from the BDI that 2021 and 2022 were definitely very good years and 2024 is a reasonable year in comparison to them. And if you compare it with 2023, then you can understand why 2023 was a poor year as I said, because of a reduction in congestion and despite the increase in demand, we still a reasonably poor year. Many owners in 2023 made a loss but we were profitable even in that year, as I said, by $20 million. Coming to the order book. If you look at the order book, in the first 9 months of this year, we've ordered 33.51 million deadweight tonnes of ships and compare that with the order book of the first 9 months of 2023, we were down by 10.3% compared to that. But compared to 2022, we were up by 20.7%, but compared to 2021, we were down by 24.3%. So again, it shows you that not much of ordering has taken place despite the fact that we had two fantastic years in '21 and '22, a reasonable year in profitability at least for PSL in 2023 and a much more reasonable year so far as it looks like in 2024. Now the reasons for that are as shown here, basically, we got crowded out. We were a little late to the order -- ship ordering party and therefore, we don't get slots for ship until 2027 at the earliest. Shipyard capacity is still down by about 40% and the main reason, I think, is that people are worried about having us stranded asset in by ordering fuel oil burning ships. Main engine availability is also a very big constraint as the main engine manufacturers have not increased capacity as compared to what the shipyards are doing. So again, this might delay the forward order book even though it's showing as quite high per annum in terms of where we were, it might be much lower because, as I said, the main engines are not necessarily available. Coming to a summary of the industry position. The IMF says that world growth will be at 3.2% in 2024 and a similar growth rate in 2025 of 3.2%. IMF and the Chinese government are forecasting China's GDP growth rate at 5% in 2024. And so far, in Q1, Q2, Q3, the GDP growth rate stood at 5.3%, 4.7%, and 4.6%, respectively. If you look at it in tonne-mile demand growth, of 4.74% in 2023, it was driven by China's economic recovery. Steel consumption in China was marginally negative in 2023 but it was ably supported by shipyards, electrical carmakers, infrastructure development and lot and lots of steel exports. If you look at the fixed asset investment in 2023, it was up by 3%. And in the first 9 months of 2024, it's up by 3.4%. If you look at the fleet growth, it grew by 3.1% in early '23 and is forecasted to grow steadily by 3.2% in 2024. Net supply will be further reduced due to lower speeds compliance with EEXI and [ CII. ] It helps you to reduce the CO2 output, but there are no benefits and therefore people may not take it too seriously. The forward order book to fleet ratio at 9.65% on the 1st of October is marginally higher than the existing 20-year old fleet at 9.45%. Keep in mind that the order book is spread all the way to 2027 and we were to extrapolate this 9.45% of 20-year olds and look at it what it would be like if there was no scrapping at all in 2027, then it would have grown by 15.43%. So if you're preparing like-for-like, then you should compare 9.65% of the fleet ratio versus 15.4% of ships that are older than 20-year age. Of course, then there are a lot of disruptions. This was also what helped a lot during 2021 and 2022 in terms of the Panama Canal being having low water, Suez Canal being disrupted by the Houthis bombing, congestion at South and North America grain ports, climate change, extreme weather events resulting in disruption at sea increasing tonne-mile demand and delays at port also. And all business have to push rates. Supply and demand balance continues to improve. Now this is what I want you to focus on. This is what is known as EPL or an engine power limit, it's been applied to 21 of our ships. And if you look at the engine power limits applied to our 21 ships, you can see that the average for the 21 vessels speed before EPL was 14 knots, post EPL, it has dropped to 12.5 knots. That means there is a drop of 1.5 knots. Now keep in mind that every 1 knot reduction in speed of the entire world fleet would equal to 5.5% supply reduction based on 250 days at sea. Now if you apply the EPL that was applied to our ships and use that as a benchmark for the whole fleet. Remember, the world fleet is older than our fleet. Our fleet is roughly 12 years old. The world fleet is almost 12.6 years old. But if you apply this same formula that we have for our fleet and apply to the world fleet, then you would see that the supply side will decrease by 5.14% based on non-eco engine ships and 250 days at sea. Coming to the ships that were not affected. You can see these are the ships that are not affected and the average speed of the 15 ships would be 13.3 knots. So what has been our strategy so far, considering the industry scenario and our fleet. So you can see that we were at 36 ships in 2021 and had been there like that at 36 ships for quite a while. Then in 2022, we added 2 more ships where get 38 ships, maintain the same strength in 2023. And out to the first 9 months of this year, it has also been maintained at 38 ships. And now in the month of October, we have taken delivery of 2 more ships. And so we are now at 40 ships. If you look at the ships that we sold, we sold Rattana Naree, Wikanda Naree and Charana Naree. If you look at them, one was 22 years old, one was 11 years old, one was 19 years old. If you look at their speeds at 12 knots and see what was the consumption at that speed, then you can see that at the first ship Rattana Naree was consuming 18 tonnes, Wikanda Naree was consuming 26 tonnes and Charana Naree was 17 consuming tonnes. Now look at the ships that we bought as replacement for these 3 ships that we sold. So far, we have taken delivery of 5 of these ships. We have 1 more ship to go, which is expected by the end of this month or early next month. If you look at the speeds of these ships at 12 knots, what do you see? The consumption at 13 tonnes, 16 tonnes, 16 tonnes, 17 tonnes and 16 tonnes. So you can see we are buying very good quality eco-engine ships compared to what we are selling off, which are non-eco engine ships, consuming much higher quantities of fuel. And then we have still 1 more ship to deliver, as I said, before the end of this month or maybe at the early part of next month. All these ships are approximately 40,000 deadweight, just shy of 40,000 deadweight. Now if you look at what has been our market position compared to the existing index ships, the index ship for the size is at 38,000 tonnes and our index -- our ships average 32,000 tonnes. So you can see that we needed -- we are at quite a big discount, I would say, about 20%, 25% discount compared to the index ship if you take into account the fuel consumption as well as the size reduction that we have. And then if you compare that, you will see that we actually we were at -- we were down by 10.38% compared to the index ships. If you then come to Supramax and look at the index ship and look at our ships, we have performed at 5% below the index ship. If you look at our forward order book for this year 2024, we have already prebooked 6,234 days out of a total of 13,705 days at an average price of $14,446. So you can multiply the average price by the total number of days prebooked, you will get $90.1 million. Similarly, if you look at next year, this number of 45% drops to 26% and 3,660 days. Against that, we've got a time charter rate of $15,653 per day, which would give us $57 million. Similarly, if you look at 2026, we have got 14% prebooked at $14,673, and that will give us $28 million total prebooked income. And then for 2027, we've got 13% prebooked 1,765 days at $14,611. So now Gautam, we'll take you to the financials.

Okay. Thank you, Khalid. So these are the highlights in Q3. For the quarter, we reported a net profit of about THB 279.9 million or USD 8.23 million or THB 0.18 per share. We had an EBITDA of THB 682.7 million or USD 20.08 million. We paid a -- our second dividend for the year 2024. This was THB 0.10 and this was paid on 6th of September 2024. Very, very active financing period during the third quarter. So on 22nd of August, as you can see, we signed a loan agreement with SinoPac of Hong Kong in the amount of USD 18 million. We also entered into another facility with Export-Import Bank of Thailand of USD 13.58 million. And then in the fourth quarter, the beginning of October, we entered into 2 credit facilities. First was the USD 13.5 million loan with IYO Bank, Japanese bank out of Singapore. And then we also issued the first sustainability-linked partnership by any Asian shipping company. So there were 2 series, a 5-year tranche and there was a 10-year tranche and total amount that we raised THB 1,360 million, that's about USD 40 million. We -- of course, we acquired a number of ships that we talked about. And then we have -- in terms of long-term charters, we've got -- we continue to have 5 ships that are on very, very long-term time charter contracts at fixed rates and then we had 17 ships on long-term time charters at index ship rates. So here a summary of the acquisition and disposal of vessels. So I think Khun Khalid has already covered most of this. Perhaps I can just add as far as the newbuildings are concerned. So we have ordered Ultramax newbuildings, and these are scheduled to be delivered in 2026. We're also -- we are scheduled to take delivery of another 6 secondhand Handysize vessel probably later this month or early next month. So key figures in Q3. So total revenues of USD 42.8 million, this was down from USD 47.2 million in second quarter. Net profit was $8.2 million, down from $14.4 million in the previous quarter. The earnings per share came in at THB 0.18 compared to THB 0.34 in the previous quarter. Return on equity was slightly down 8.1% compared to 8.59%. And net debt to equity ratio, this went up a little bit because, of course, we -- since we've been acquiring ships. It's still at a very low level from a historical perspective, it's a 0.32 compared to 0.26. And the number of ships that we have on our fleet is 38 versus 36 at the end of the second quarter. So this, on the top left, we show you the time charter or the average time charter rate per day in dollars for all the ships in our fleet. And you'll see that the latest quarter, the third quarter average time charter rate was the second best of the last 5 quarters, event at the average rate was $12,755. The EBITDA is quite healthy, it was $20 million. We here -- on the bottom left, we showed the dividends, and we have paid out dividends of about THB 155 million in the third quarter, and we have quite a healthy cash balance, we ended the quarter with USD 49 million. So this is a picture of our balance sheet. So you will see that in the -- at the end of the third quarter, we have 626 million of vessels and equipment. Our shareholders' equity went up to $494 million compared to $475 million. Cash, So we use some cash to pay for -- to partially pay for some of the ships that we've acquired. And so you see this some of that vessels and equipment has increased and cash has gone down. And overall debt has actually declined a bit. So it was $214 million at the end of last year, and that's down to $205 million. So here again is a summary of the cash movement in Q3. So we ended the quarter -- the second quarter with $75 million of cash. We generated $28 million of cash from operations. We, of course, acquired ships and the secondhand ships during the quarter, so that $48 million of cash went towards CapEx, $4 million towards interest costs. We also drawdown -- drewdown a loan. So that was $18 million, and we partially prepaid another loan. In addition to repayments, that was $16 million, and we paid dividends of $4 million and we ended the quarter with $49 million. So this is a summary of loan movements during the quarter or -- actually since the beginning of this year. So $214 million is what we started off with. We drewdown $15 million from several banks, we repaid $22 million, we prepaid $37 million, and we ended quarter with $205 million. But we still have a number of undrawn loan facilities available. So we've got $88 million of undrawn facilities available from IFC, CACIB, and EXIM, and another 2 large facilities from EXIM, which we can draw down. And in addition, so I think we already covered the IYO Bank. So here's a summary of our operating expenses. So you'll see that the operating -- the total operating expenses in the third quarter, they came in actually slightly lower than the total operating expenses for the second quarter but of course, the differences are quite marginal. In general, we would say that costs have remained fairly stable. That's what's reflected over here. So this over here we show the -- on the left, the lighter column is the average industry operating expenses and the darker column shows you our operating expenses. So as you can see, we are still lower than the average industry operating expense, every $100 in savings translates to about $1 million on the bottom line at the end of the year. Over here, we compare our OpEx and G&A to other listed peers in the -- on Supramax and Ultramax vessels. So as far as OpEx and G&A is concerned, so we are -- in total for these 2 items, we are the second lowest among our industry listed peers. In terms of G&A, we are actually the lowest and over here, we show you the long-term last 12 months EBITDA per ship. And so we've come in at a third but it's almost second, I would say, our average EBITDA per ship for the last 12 months came in at $2.66 million versus one of the other peers who are at $3.26 million, which is the highest. So this -- over here, we show the debt maturity profile. And -- so we've been very active in refinancing much of our debt, pushing out maturities, as you know, we also raised the bond, and that will also help in pushing out maturity, the average maturity of our loans. And that's reflected over here. We don't really have very much -- very lumpy amounts due, very high maturities due in the coming year. It's very manageable amounts that are due. Over here we show you the net debt and net debt-to-equity ratio. So you will see that peaked in 2017 when we took delivery of the final vessel that we had -- final vessel in a series of vessels that we had ordered from several the yards in China. Since then, we've been paying down debt and we've come to a very, very low level about 0.3, and of course, we have now started to acquire some secondhand vessels, and we've raised a little bit of debt to acquire these vessels but still it's -- the total debt or the net debt rather is still at a very healthy level of $156 million. So this is over here. If you look at the top line, we -- this is the average age of ships that we had in our fleets. And you'll see that from the year 2005 until about 2011, we had a very elderly fleet and also quite a small. But then after we embarked on a program to acquire new ships, we ordered new ships, larger ships and so the average age of ships in our fleet came down, and also the average size of ships in our fleet went up. And at the moment, it's about 44,000 deadweight. This line over here shows you the average time charter rate per ship per day and can see 2005 until about 2008 was a very, very buoyant period. This is when China joined the WTO. But of course, it's also coincided with the time that the order book was about 80% of the existing fleet, all the ships were delivered in the period from about 2008 until 2015, '16, and that puts a lot of pressure on rates, and that's why you see rates declining. Supply pressures abated significantly from 2016 onwards and thereafter, which is why you see a gradual increase in rates because of better supply-demand fundamentals. Bottom line over here shows the average operating expenses for the ships in our fleet, which has remained quite stable. Here we show the dividend. So our policy is to pay not less than 25% of net profit to shareholders as dividend. We have generally paid more than that as you can see. There was a period from 2014 until to '21, shipping was from a major downturn. So we stopped paying dividends but of course, we resumed it, and we are paying in general dividends that are at the level, which is higher than the dividends, the minimum policy that we have. Here's a lot of data. I believe that as a reference slide. Just one thing to highlight. So this is the total return to shareholders from our IPO in 1993 until about 30th of October. So you'll see that. So if you are an investor in our IPO in 1993 and you remained invested and also you reinvested all your dividends back into our stock, you would have earned a 15.76% IRR on your investment. So similar data points. So here, this is data from Splash 247 articles on dry bulk listed companies. So you'll see that most dry bulk companies, listed dry bulk companies, unlike us, have actually not delivered positive returns for shareholders. Okay. With that, I think we are running out of time, so I will open up for -- okay, just one thing to just mention. So during the quarter, we received the Outstanding Climate Action Leading Organization awards. This is the -- actually the second year in a row that we received this from the Government of Thailand. We were also awarded Carbon Neutral Certification by the Thailand Greenhouse Gas Management Organization, this is for year 2023. We already had it for 2022 and we we've got this award because of the offset completely our scope 1 and scope 2 emission. And yes, I think we -- since we're out of time, let's take questions.

So the first question is, I think Gautam you can answer, what is the average borrowing cost of loans?

So the average borrowing cost of loans. So let me answer it this way. So about 1/4 of our debt is fixed rate, and this is fixed rate at -- this was fixed when interest rates were extremely low and about 75% is floating. So that's SOFR plus margin. Now we don't typically disclose the margins that we make to our banks but I think you can work that out yourselves by looking at the interest cost, you can figure out. So essentially, it's a SOFR plus a margin, and that keeps changing. I mean, just now with the bond that we issued that was issued at a relatively lower level. So that should help in decreasing our overall interest costs.

Okay. Coming to the next question, which regions are the most sailing routes of the PSL fleet in 2024? We don't have any regions or routes. We're like a taxi service. We perform the journey according to what the client wants. So no 2 journeys are ever identical and 2 years are ever identical. Now coming from the total of ships under long-term contracts, yes, of those 6 of them are on -- 5 of them are on the long-term fixed rate contracts, and the balance are on long-term contracts, which are linked to the index. Now index-linked works like this, for the past 15 days, what is the average price per day per ship for the index ship will be what we will earn in the next 15 days. So we'll get the prepayment of that on the end of silicon on day 1, we'll be paid what was the average price for the last 15 days. We will be paid for the next 15 days at that average price. Coming to the revenue contribution on long-term...