Wallenius Wilhelmsen ASA (WILWY) Earnings Call Transcript & Summary

Good morning, and welcome to our quarterly presentation. It's great to see so many people here today, a warm welcome to all of you, and a warm welcome to all of you watching us online. So Anders, what can we expect today?

Well, I think we're going to hear how we have maneuvered in a volatile world, and we'll get an update on the results for the quarter.

Very soon, as usual, we'll start with our CEO, Lasse Kristoffersen, who will take us through the market and also how we have delivered this quarter. He will be followed by Bjørnar Bukholm, our CFO, who will take the financial highlights. Lasse will then be back and as usual, again, take the market outlook. And then Anders, you will take the Q&A session. So what do we need to know about that?

Well, for the online audience, please post questions in the Q&A box. Be wary, it takes a while for the questions to arrive actually in the digital world. So posting as early as you can in order to make sure that we can answer them. And there will also be a possibility to answer questions here in the audience and we'll send around microphone.

Perfect. I think we're set then. Are we?

[ For sure ].

So with that, Lasse, the stage is yours.

Thank you. Good morning, and welcome. And I must admit when I got up this morning and thought about this presentation, I was a little bit surprised by the fact that how fast we forget. Second quarter was maybe the most uncertain, volatile and in many ways, outlier in global economics and global trade. And there was a constant change in what was the reality was and how volumes moved. And then looking back on how we have performed as a company, I must say I'm really, really proud of the team and the numbers we're going to present today, and we'll give you some more details of why we've been able to do so. But starting with the headlights -- or highlights more importantly. We are delivering another strong quarter. One of the strongest quarters we have ever delivered in Wallenius Wilhelmsen, we have an EBITDA of $472 million, which is up 2% since the last quarter. And we see that the demand is still firm. We had strong demand during the second quarter. That continues into the third quarter. We are paying a dividend of $1.10. This is in line with our policy where we pay 50% -- up to 50% of our net result. But we're also paying out the full proceeds from the sale of MIRRAT. And for those who don't remember, MIRRAT is a terminal in Australia that we have built up over the last few years. And that transaction shows the underlying values we believe sits in our logistics portfolio. We also took note, of course, of the announced trade deals, but we are very firm in saying that these are not signed yet, and there are still some uncertainties on where they will land, but the fact that there seems to hover in around 15% is a very strong signal to our customers and at least reduces uncertainty. Looking forward, we expect EBITDA in 2025 to be in line with 2024, and we expect 2025 to be another very strong quarter. And in this report, we're also updating that we are changing some of our financial metrics. Bjørnar will cover this in detail, both what we do and why we do it. But one noticeable one is that we have now set a very clear and upped our target in terms of return on capital employed to 12%. And this is due to the performance we have seen over the last few years and also the target performance that we have going forward. So then, let me dive into some more details, starting with the market. What is really driving this around us and where do we see both headwinds and tailwinds? In general, the -- you could say that the demand for cars in the world, the production of cars in the world is muted. And most likely, we will see it a less number of cars produced or equipment produced in the world in '25 than in '24. But still, there is growth in the deep sea, meaning that those who are further from the market are still relatively the winners in production. And we see this, in particular, out of Asia. And this is a story that is just continuing, mainly driven by China. The growth is for sure coming out of China, both on autos, but also on High & Heavy. And then that is supported by a quite firm at least flat and somewhat up also from other exporters in Asia. And both Korean and Japanese OEMs are performing relatively well in the year and in the quarter. While the Western OEMs, in particular, the Europeans have seen their competitiveness falling over quite a while. And for the European OEMs, there's kind of a double whammy in the quarter. They have, for a couple of years, seen that their market shares in China are dropping. And remember, 1 out of 3 cars in the world are sold in China. Roughly, you can say 1 out of 3 stores all in China, 1 out of 3 is sold in Europe and U.S. together and 1 out of 3 in the rest of the world. That's the market. So losing significantly market shares in China is critical for European OEMs. Adding to that, the increased uncertainty in the quarter from the tariffs into U.S., really created a [ hammock ] for European OEMs. And some of them even paused exports, some of them delayed exports, and that meant that the volumes out of Europe are both on a structural down, lack of competitiveness but also on a cyclical down or volatility down in the quarter due to tariff uncertainty. We have seen though that the activity out of Europe is now maybe trending a little bit up into the second half. We see that on the volumes in our terminals. We see that on the bookings forward out of Europe. So we might have the bottom behind us. But still, there is a fundamental difference in the competitiveness of Asian versus European and also U.S. car manufacturers. And this creates an imbalance in the trade. So although in the previous one, you saw there was a marginal increase in deep sea, the increase comes out of Asia. That means that we need more capacity to solve that because we don't have the volume going back. So all the growth in volume adds extra demand in the market. When we talked about tariffs, this is a quite, let's say, messy graph, but the main point here is to show on the right side of the 2 graphs that it seems now that we are zooming in somehow on 15%, 17%, depending on stacking or not on cars. But what has hit, the actual bill yet is only 9% because of delays in imports, time-to-market and so on. So we have not yet seen the effect of the high tariffs of '25. So this is now being worked into the market. So nobody knows the effect when we sometime probably end up around 15% if that's put also into ink. So we are quite careful in forecasting the effect of the tariffs because they have not really affected yet. In general, you could expect U.S. production to go up based on following these policies. We have not really seen that. We are seasonally up, but we are down year-over-year. And this is relevant, of course, for our Logistics business in the U.S., where we are sitting at the back of many factories. And of course, as in any market, some producers are doing better than others. But in general, the production in the U.S. is, relatively speaking, a bit muted. And we have not seen a surge in those production volumes yet. I think it's noticeable though that you can see that the production is very steeply down on what we call heavy and medium trucks. Those are for commercial use. So there is certainly a decreasing sentiment when it comes to more of the business-driven demand for cars, while on the private market, they're still strong, but it's down. The fleet is growing. And it has been a theme in our industry for a while that quite significant amount of vessels have been ordered, which is true. What we saw so far this year is that close to 40 vessels have been delivered. Despite that, we experienced a very balanced market. And then we expect more or less the same amount of vessels delivered in the second half of this year. And then we're adding some more vessels going forward. But we have not yet seen a shift in the market balance due to new vessels being delivered. So then when we take all this, the market around us, so how does that affect and how are we positioned as Wallenius Wilhelmsen? Well, we are a leading player out of Asia, and we believe we are very well positioned for the growth that comes out of Asia, and we are, for sure, winning our share of that business. We have been able to manage the volatility in the U.S. We said in the first quarter that we saw a drop in revenues, but we were not able to adjust costs accordingly. Now we are seeing that those costs are coming down in line with activity level. And we're also able to shift capacity from the Atlantic into ex-Asia when we see volumes are slow. So the fact that we are global and truly global enables us to adapt to where the demand is. And we still experienced a balanced market. And there's no doubt that the peak for rates are behind us, but we still experienced strong rates when we do short-term business in the market. Jumping into the segments. Shipping ended at $411 million, which is one of the strongest quarters we have had on record. Logistics seems to be very much down, which they are, but the main factor in terms of the reduction in EBITDA comes from the sale of MIRRAT. MIRRAT was a strong generator for us. The underlying business in Logistics is actually slightly up quarter-on-quarter, and Bjørnar will come back to this. On Government services, there is quite some periodical effects. So don't look too much on the slower second quarter versus the first. Year-to-date, we were ahead of year-to-date last year. And we see strong demand for Government services out of the U.S. Looking into the details on Shipping. Volumes were up in the quarter. And that was partly also supported by stronger High & Heavy volumes. I will come back to that. And we see that this is again driven by ex-Asia volumes and strong growth in ex-Asia volumes. On rates -- no, sorry. Then back to more details on that, you can see that we have quite a steep incline in the volumes out of Asia. And largely speaking, this is driven by 2 factors: the growth of China, but for sure also our increased market share of Korean exports. As you might remember, we increased from 40% to 50% in the contract with Hyundai and Kia. At the same time, we see that the volumes out of Europe are dropping, and this is partly due to lower exports and partly also due to a business that we have decided not to renew due to the terms in the business. But largely, this is driven by market demand. I mentioned that we saw a quite steep rebound in the High & Heavy numbers in the quarter. We do not see this as a start of a rebound in High & Heavy. This is more periodization effects of some cargo being front-loaded, but also the fact that we have customers that are winning market shares. And our biggest customer in High & Heavy are doing extremely well, and we see that their export numbers are strong, and we are carrying more or less all of those volumes. So this is more an underlying trend with some customers, but also a periodization effect. We do see, though, that our customers still repeat that they have strong confidence that things will improve into 2026 for High & Heavy. And then in particular, in public infrastructure, defense spending, energy and mining. On rates, we have more or less a flat development. If you look on the repricing, quarter-on-quarter, it's flat. Repricing year-over-year shows that the contracts rolled in this year is slightly higher than those last year. There is a small negative effect from customer mix, meaning that we, relatively speaking, had more volumes from lower-paying customer contracts in this quarter that typically equals out over a couple of quarters. And then for sure, the trade mix shows that the rates are up. But this is important to understand that this is because we are doing relatively more out of Asia, better paid; relatively less out of Europe, less paid. But normally, we do this on our own voyage. So it's certainly not positive for us to have less out of Europe, but it certainly shows that we have higher net rates because we have more of the volume with a higher-paying cargo. In general, we would say that the net effect quarter-over-quarter is more or less flat, but certainly a positive development due to some reprice contracts since last year. If you go to Logistics on volumes, I mentioned it earlier and also in the last quarter, we saw the volumes dropping in Q1. We were trying to adjust costs accordingly. We were not able to. We have been able to do that largely in this quarter. So you can see that despite more or less flat volumes, for instance, on autos, we have been able to increase our margins by taking out costs. Still in High & Heavy, and we see this on the ground in the U.S. and other places where we have what we call EPCs, basically, production facilities completing High & Heavy equipment that the new equipment is moving slow. Storage is still high, and the flow is still quite slow when it comes to High & Heavy. Our customers and the dealers also see still no rebound in volumes. And that means that we also have a quite low volume on our processing. On the Terminal, we saw a drop partly due to MIRRAT effects, but also for sure that we had slower volumes out of Europe and then into the east, particularly East Coast of the U.S. We have added some of our information on contract and book of business in this presentation, and we will do that on a regular basis also going forward. For 2025, if you can see on the left-hand side for Shipping, we are more or less sold out. And roughly speaking, we have, we're 90% covered for next year when it comes to capacity and volume. And this is completely normal. So we are not stressed by not having 100% now. There's constant renewals. And that showed all the way to the right. So we are announcing our contracts above $100 million, but we do a lot of contracts below $100 million. So just in this quarter, we added some $300 million for shipping, none announced, similar for ship -- for Logistics, $200 million. So in this quarter, just by renewing business, winning smaller business, adding business here and there, we have added $500 million to our book of business. And this is normal business. This is normal procedure, and that's why you will not see them in big announcements. But we are quite firm that we will be able to fill that gap also -- at least, most of that gap into 2026. The duration of our contracts are for Shipping. If you wait, if you have it based on net freight, it's 3.6 years while it's 7.8 years for Logistics. So we have a strong book of business. We're sold out this year. We have a strong book of business for next year, and it's growing, and we are constantly adding to that book of business. A couple of developments in the quarter that's worthwhile noticing. We sold an old vessel, and we also exercised some purchase options, and these are very attractive transactions. The purchase options are well below the market. It's end of time charter deals. And we were able to sell an old vessel that didn't fit in our trading pattern anymore to current market rates, which are, in our view, quite sound. Then we also announced in a quite exciting project. In a way, Wallenius Wilhelmsen is coming home to Norway. We are setting up a facility together with Bertel O. Steen in Drammen. This will be a state-of-the-art -- we think actually state-of-the-art in the world, but certainly in Norway in terms of processing of cars coming into the Norwegian market. We are -- if everything goes as planned, we will start building early next year and be in full operation in 2027. We'll be in Drammen port. And this facility can process up to 35,000, 40,000 cars a year and will be most likely the best and the most modern entrants into the Norwegian market, and we're quite excited to do this together with Bertel O. Steen. On sustainability, in the last quarter, we saw some of our safety statistics jumping. I told then, and I repeat now that this is based on very few incidents, and hence, we have big periodization effects. So that what we saw in this quarter was that it fell down significantly on shipping. And we are happy with the average performance we have on safety. And we are now continuing our positive trend of reducing our incidents, and we are working very actively with both safety management, but certainly also on safety culture. And this seems to be paying off. On emissions, we are still doing quite well in reducing emissions on -- in terms of actual emissions from our vessels and the distance they sail. However, we do see that our EOI, meaning that the emissions per car, to put it simply, is increasing. And this is due to the increased trade imbalance. So when we have 1 car from Asia going to Europe, and we have no car taking back, that single car needs to have the full emissions for the run voyage. If we have 1 car going west, 1 going east, each get 50%, meaning that, that structural imbalance increases the emissions per car. However, the emissions from the vessels are continuing to go down. The emissions on vessels, if you divide it by the tonne miles they do, are continuing to go down. And this is what we can control, and we work really hard in continuing that trend. And then we also updated the market that we have for -- in our Shaper class newbuilding project. We have taken half of the vessels and made them ready for ammonia, meaning that we are putting in tanks that can do both LNG and ammonia. And we are also through that, being able to source LNG and bio-LNG. And through now having 7 of the vessels capable of doing methanol and 7 of the vessels ready to do ammonia and LNG, we're now able to tap into all different fuels of the future. And we think this is absolutely critical. We believe that we need to be able to tap into all kind of biofuels in the short- to medium-term. That means biodiesel, bio-LNG, biomethanol and then the medium to long term into all e-fuels and that means ammonia, methanol and possibly others that we don't know of yet. And now we are well positioned to do so. So with that, I'll leave it to Bjørnar to take you through the numbers.

Thank you, Lasse, and good morning, everybody. And also thank you, Lasse, for no jokes here because I was clearly not prepared for that this morning. Although I was thinking about it before we started, what can Lasse figure out today? But thank you, Lasse. Jokes aside, I will cover the financial update as last time. Starting with financial targets. As Lasse mentioned earlier in his presentation, we have updated the financial targets now to better reflect Wallenius Wilhelmsen stand today in terms of financial performance and also the financial solidity of the company and also where we see that performance should lie going forward longer term. On a high level, the changes in financial targets reflect that we have increased ambitions for returns, reduced leverage and improved management of liquidity. If we look into the details of the changes starting with return on capital employed, we have increased this from 8% to 12%, where roughly the first half of the change is explained by the change in accounting treatment for the EUKOR put call option that towards end of last year, the put option -- the price for the put option was classified as a liability on our balance sheet, hence, reducing capital employed. The second part of the change is reflecting our ambitions for financial performance over the cycle and improved balance sheet management. Moving over to the equity ratio. We have kept it unchanged at 35%. Leverage ratio, we have reduced from less than 3.5x to less than 3x with a clear ambition for the company to have a moderate debt level and solid liquidity reserves as this will allow us and give us the flexibility to invest and return capital also in softer markets. Finally, we have introduced a new target for minimum liquidity of $1 billion, consisting of operational cash and RCF capacity to allow for quick decisions on investment needs, financing needs, et cetera. It's important to highlight that we don't consider the financial target as restrictions. This is rather aspiration of where we want to be, guiding principles. Then moving over to the highlights for the quarter. And as already mentioned for Lasse, it's a new very, very solid quarter for Wallenius Wilhelmsen, and we are proud of the strong results. Diving into the details, starting with revenues. Revenue stands at $1.35 billion, up a couple of percent compared to last quarter due to stronger revenues for the Shipping segment. Comparing to last year, largely stable revenues. Shipping is up while the Logistics segment is somewhat down. Moving over to adjusted EBITDA, $472 million, up 2% quarter-on-quarter due to strong performance for Shipping, slightly down for Logistics and for Government. Compared to last year, there is a drop of $25 million. That is explained by the Logistics segment. I'll be coming back to that. Very strong net profit, $403 million, of which $135 million relates to the sale of MIRRAT and a sales gain from that transaction. Adjusting for the sales gain, we have a net profit of $268 million, up 8% quarter-on-quarter with the improvement driven by the stronger EBITDA and somewhat lower tax expense in the quarter. Net debt, $1.75 billion, that is up $90 million in the quarter. That is explained by the strong dividend of $524 million that was paid in April, partially offset by strong operating cash flow and also proceeds from the MIRRAT transaction that was received in May. Moving over to the right-hand side, financial targets. Proud to present yet end of the quarter with return on capital employed on around 20%. Equity ratio up to 41%, up 6%, 7% on the back of the strong net profit. Leverage ratio remains below 1x and liquidity reserve stands up nearly $2 billion at the end of the quarter. Moving into the specifics on the segments, starting with Shipping services, revenues of $1.033 billion, up 7% quarter-on-quarter, due to strong volumes, partly offset by somewhat weaker net freight rates. It's already shown by Lasse, volumes up 8%, driven by increased volumes out of Asia, partially set by lower volumes out of Europe. Net freight rate, down 2%. That is due to customer mix. It's a neutral effect from repricing and the trade mix. If you look at EBITDA, 411 million, 6% up quarter-on-quarter due to increased revenues driven by the volumes, partially offset by somewhat higher cost, mainly to carry additional volumes. Looking at cargo expenses and other voyage and OpEx, which is typically the variable cost, increased by $25 million. That is due to more volumes. Then we also had vessel OpEx and charge expenses by a total of $4 million. That is due to 2 additional owned vessels during the quarter due to utilizing the purchase option mentioned by Lasse and then there's also somewhat more chartering activity in the quarter. SG&A is up by $ 10 million. We had some additional project cost expenses in the quarter. And then we also had the effect of salary adjustments in the second quarter. But all in all, another very strong quarter for the Shipping segment. Moving over to Logistics. Revenues came in at $273 million. That is down 3% compared to the last quarter. That is fully explained by the sale of MIRRAT. Adjusted EBITDA, $32 million. It's down 12% quarter-on-quarter. Also here, this is explained by MIRRAT. If you adjust for MIRRAT, we actually had an improvement on EBITDA of $3 million quarter-on-quarter with improved performance for the Auto segment or the Auto business area and the High & Heavy business area on stable revenues but we were able to take out quite significant costs in the quarter that improved the margins for that business. And this is a continued focus area for Logistics area going forward. Terminals came in flat, improved performance in the U.S. And in South Korea while the European terminals was somewhat softer, which is linked to the export volumes that is already mentioned by Lasse. When we look at the development for EBITDA compared to the same period last year, we see a big drop. That drop is explained by MIRRAT, and it's explained by weak results for the Auto business area and it's explained by weaker results for the European terminals. Moving over to Government services that delivered another very strong quarter, although somewhat down compared to the same period last year, but note that this is seasonal and year-to-date, we're actually performing better than last year. Revenues, as you can see, largely stable, both quarter-on-quarter and year-on-year. EBITDA, $41 million, that is down roughly 15% compared to the same period last year and also quarter-on-quarter. The difference lies in the type of volumes that we lifted. So the cargo mix is impacting this. And we also have 2 extra vessels part of the fleet in this quarter, which were previously on commercial charter with other parties in the group, which is increasing the cost. But underlying results for Government service remains very, very solid. Moving over to liquidity. Liquidity rate remains strong, stands at close to $1.4 billion at the end of the quarter. Yes, it's down close to 20% quarter-on-quarter, but that is due to material debt repayments and the dividend that I already mentioned. Investing cash flows of $164 million positive due to the proceeds from MIRRAT, partially offset by CapEx of $64 million, of which $40 million is related to the newbuilding program. Financing cash flow, negative $923 million, regular repayment of vessel loans, and then we also had a voluntary repayment of an RCF of $205 million to improve our liquidity and cash management. And then again, we had the dividend. Quickly on the balance sheet and our solidity. I already mentioned this, so I will be brief. Equity ratio, 41%, materially up due to a strong net profit for the quarter. Net interest-bearing debt, $1.7 billion, slightly up compared to last quarter due to the dividend and then leverage ratio remains below 1x. Liquidity reserves close to $1.9 billion, $1.4 billion almost in cash, and then you have RCFs undrawn of around $500 million. A few changes on the RCF side took place in the quarter. We terminated a facility in WW Ocean of $150 million. This was a short-term facility with limited value for us, and then we repaid $205 million for the facility we have in WW Solutions. Moving over to dividends. Yesterday, August 11, our Board approved a total dividend of $465 million, equivalent to $1.10 per share for the first half of 2025. The dividend is based on 50% of the underlying profit for the first half of the year. And by underlying profit, you mean the profit, net profit minus the sales gain from the MIRRAT transaction. And then we had an added element linked to the full cash proceeds of use to $210 million from the sale of MIRRAT. So all in all, this represents around 75% of the net profit for the period compared to our dividend policy that indicates 30% to 50% of net profit, but with an opportunity to do extraordinary dividends if there is something special, which MIRRAT clearly is. The strong dividend, we see that that's a testament to the very strong performance of the company and also the very solid financial position of the company. Finally, a couple of words on the newbuilding program from a financial perspective. In the second quarter, we secured post-delivery financing of $300 million for 4 Shaper class vessels at very attractive terms. The loan is split in 2 parts. It's used $250 million term loan, which is green. Actually, the first one in our company, that is green, and then we have $150 million sustainability-linked revolving credit facility. What the revolving credit facility actually do is that it gives us increased flexibility on drawings on the debt, which helps us to optimize our liquidity management going forward. Tenor for the loan is 5 years from the last delivery -- from the delivery of the last vessel. With this financing in place, we have attractive financing in place for 10 out of 14 Shaper class vessels, and they will manage financing for the remaining vessels in due course. Over to CapEx. At the end of the second quarter, remaining CapEx for this program is roughly $1.5 billion, and we have paid $43 million so far. Lasse commented on the change in fuel for 7 of the vessels. That came into an additional CapEx of USD 80 million. That's especially the LNG tanks are very, very expensive, but it positions us much better for the future in terms of flexibility for fuel sources. With that, I will hand it back to Lasse for further prospects.

Thank you. And let me just get to it. We are experiencing strong demand and utilization, in particular in shipping, and we see this continuing into the Q3. There is still a strong demand and a good balance in the market, and we expect 2025 to be in line with 2024. This is, as I said, driven by the growing exports out of China into basically all markets of the world, but the U.S. We expect that to continue. But we're also seeing some signals that European volumes might come up somewhat in the second half of this year. We do not expect yet a rebound in High & Heavy despite the strong volumes we have. But coming into 2026, signals from our customers are strong. So we are maintaining a strong outlook for the year, and we believe 2025 will be another very strong year for Wallenius Wilhelmsen. So with that, I ask Anders and Bjørnar back to the stage.

[Operator Instructions] First, Lasse, the market is good. How long can we expect it to last?

Well, the current market momentum is certainly continuing to Q3. And -- but with the current volatility, and when we speak to our customers, even they don't know what's happening in Q4, but we still think that this year will be a strong year. It's too early to call 2026. But the momentum that we are experiencing are currently continuing into certainly the third quarter.

And Bjørnar, you're paying out $1.10 in dividend just a reflection of how is that split up and why that amount?

Yes. Thank you, and thanks to the audience for letting me repeat a good message. So the way we are thinking about this is that we have the net profit, and then you consider what is the underlying net profit of the business, and that is what the business delivers minus the sales gain for MIRRAT. So we took 50% of that amount, which is in the upper end of our dividend policy, and then we added an element to that, which is the full cash proceeds of $210 million from the sale of MIRRAT that took place in the quarter, and that adds up to $465 million.

Yes. Thank you. We'll start off with questions from the audience, if there are any. Anyone? There seems to be no questions from the audience. So then we'll start with the questions from the web. There is a question around our newbuilding program. If demand dips, what is our plans in terms of recycling of all the tonnage when new vessels are delivered?

Of course, we -- normally, we plan for running a vessel in 30 years. Now the demand has been so strong that we have decided to take a couple of vessels through that 30-year renewal in terms of class and run them older than that. But in general, I would say that we will probably see that vessels turning 30 are more candidates for scrapping going forward. When it comes to a newbuilding program, this is to replace our core fleet where that makes us -- it kind of hits our secret sauce. Large vessels that can take, have huge flexibility on high & heavy breakbulk and cars, and these will create competitive advantage for us when they are delivered. We are very happy to get them in, but we have a huge need for capacity also in '29 and '30 and beyond. So this is a start of a renewal program. It's not growth. It's renewal of our fleet. And of course, when we renew our fleet, we will phase out old vessels as new vessels are being delivered.

Then there is another question relating to logistics. In terms of demand per region, how has that evolved? And they're asking for thermals auto and high & heavy.

Okay. That was many dimensions. Let me start then east and going west, demand out of China in terminals in logistics, strong. Volumes are going up on both Auto and High & Heavy, and we talk a lot about the Auto growth out of China, but the similar numbers are for High & Heavy. And we do some logistics activity there. We are well positioned in Australia. We see growth in Australia. And we are now actually also entering. We've done a lot of more on the High & Heavy in Australia, and we're now coming into the Auto segment as well and growing with, for instance, Chinese players coming into the market. In Europe, I would say it's a somewhat softer sentiment, both on High & Heavy and cars in the quarter and right now, and this is more due to uncertainty, but also some structural decline, but we see a bit less numbers, although the momentum has picked up a little bit into Q3. In the U.S. and North America, it's extremely hard to say one answer. Some producers are doing extremely well. Others are losing market shares. For instance, in this quarter, I think if I remember right, GM gained 10% market share while some of the others lost 10% to 15% in volumes. So it's a very big difference in the U.S. But in general, I would say that the activity on the East Coast terminals are a bit softer. West Coast terminals are -- and activity is very full. Canada is going extremely well. And I would say Mexico is going surprisingly well and delivering good volumes and numbers despite the uncertainty of tariffs.

Thank you. That was an elaborate answer. So on the fleet, there is a question around do we have plans to sell any additional older vessels? And how is chartering market? Are we looking at adding tonnage?