Earnings call transcript: Solstad Maritime’s Q3 2025 results show mixed performance

Solstad Maritime ASA reported its Q3 2025 earnings, revealing a decline in revenue and adjusted EBITDA compared to the previous year. The company’s stock price decreased slightly following the announcement, reflecting a complex market sentiment. While the earnings per share (EPS) and revenue forecasts were not explicitly provided, the company’s financial performance indicates challenges amidst a dynamic offshore energy market.

Key Takeaways

• Q3 2025 revenue fell to $145 million, a decrease from $152 million in Q3 2024.
• Adjusted EBITDA dropped to $69 million, down from $91 million in the previous year.
• Fleet utilization decreased to 80%, with the North Sea market showing slower activity.
• Solstad Maritime secured long-term contracts, bolstering its backlog near $1.7 billion.
• The stock price decreased by 0.81% following the earnings release.

Company Performance

Solstad Maritime faced a challenging Q3 2025, with revenue and adjusted EBITDA both declining compared to the same period last year. The company attributed this performance to a slowdown in short-term demand, particularly in the North Sea. However, Solstad Maritime remains optimistic about long-term offshore energy services demand, with significant project opportunities in regions like Brazil and Guyana.

Financial Highlights

• Revenue: $145 million, down from $152 million in Q3 2024.
• Adjusted EBITDA: $69 million, a decrease from $91 million in the previous year.
• Net Result: $32 million, down from $48 million in Q3 2024.
• Book Equity: $804 million, up from $696 million last year.
• Equity Ratio: 48%.

Market Reaction

Following the earnings announcement, Solstad Maritime’s stock price experienced a slight decline, dropping by 0.81% to $17.10. This movement reflects investor concerns over the company’s decreased revenue and EBITDA, as well as the lower fleet utilization rates. The stock’s performance remains within the company’s 52-week range, indicating a cautious but stable market sentiment.

Outlook & Guidance

Solstad Maritime provided guidance for the full-year 2025, projecting an adjusted EBITDA of approximately $290 million. The company also expects capital expenditures to stabilize in 2026, with a range of $115-$125 million for the current year. The quarterly dividend was set at $0.032 per share, totaling $15 million.

Executive Commentary

CEO Lars Peder Solstad expressed confidence in the offshore energy market, stating, "We remain positive to the offshore energy market globally." He highlighted the firm’s strong backlog and future earnings potential, noting, "We have $250 million already booked in EBITDA for 2026." These comments underscore the company’s strategic focus on long-term growth despite current challenges.

Risks and Challenges

• Decreased fleet utilization, particularly in the North Sea, could impact future earnings.
• Increased competition in the crane vessel segment may pressure margins.
• Short-term demand fluctuations in key markets like the UK pose operational challenges.
• Macroeconomic factors, such as inflation and interest rate changes, could affect financial performance.
• Dependence on long-term project opportunities in regions like Brazil and Guyana introduces geopolitical risks.

Q&A

During the earnings call, analysts inquired about the extension of the Norman Vision contract and tender activities for construction support vessels. The company confirmed a "healthy" extension rate for the Norman Vision and ongoing discussions with Petrobras for upcoming contracts. These insights reflect Solstad Maritime’s efforts to secure long-term utilization and maintain competitive contract rates.

Full transcript - Solstad Maritime ASA (SOMA) Q3 2025:

Lars Peder Solstad, CEO, Solstad Maritime: Good morning and welcome to the Solstad Maritime Q3 2025 results presentation. My name is Lars Peder Solstad. I’m the CEO of the company, and I’m joined by CFO Kjetil Ramstad. After this presentation, we will open up for Q&A, and please ask questions in the chat. Please keep in mind also that this is a Solstad Maritime presentation, so if you have any questions related to Solstad Offshore ASA, please wait until the next presentation starting at 10:00 A.M. We’ll take a quick look at the disclaimer before we move on to the quarter’s business update and highlights. We had an adjusted EBITDA for the quarter of $69 million, down from $91 million in the third quarter last year, primarily due to lower fleet utilization in the second half of the year.

This is in line with the trading update we gave 9th October, where we adjusted the full year 2025 EBITDA guidance to approximately $290 million. On the market update, we see that there’s a long-term demand within offshore energy services that remains positive, with several new long-term opportunities and also project opportunities that we see in the market. However, on the short-term demand, we have experienced a lower demand than we previously expected. Having said that, we continue to sign new contracts, and the order intake in the quarter reached $180 million and resulted in a book-to-bill ratio of 1.2 for the quarter. We signed some very important contracts in Australia, where two of our anchor handling tug supply vessels are fixed for the majority of 2026, reducing the potential spot exposure.

In addition to that, we have also reduced the spot exposure in the North Sea for the anchor handling fleet from four vessels to two vessels lately by signing contracts in Brazil and in the Mediterranean. On the construction support vessels that we have with market exposures, they are all working on projects at the moment, and it’s likely that we will see them occupied with a decent utilization also going forward. Finally, I will also like to mention the contract that we signed and reported yesterday, which is not included in the quarter’s book-to-bill, where we extended the contract for the large pipelaying vessel Norman Vision to the end of 2027 with Ocean Installer, and where we also have mechanisms that can extend the contract into the next decade.

The fleet utilization in the quarter was somewhat lower than last year, as I mentioned, with 80% in this quarter compared to 89% last year. If we look at the various segments, the anchor handling fleet came in at 76% and the CSV fleet at 81%. The board has also decided to distribute the cash dividend for the quarter of $0.032 per share, which is a total amount of $15 million for the quarter. If we take a closer look at the market, we see that we remain positive to the offshore energy market globally. Globally, we have seen that the activity is good, and it offers more opportunities. In 2025, it is the North Sea that has had lower activity than we previously expected, and especially on the UK side, the activity has been slow and has led to lower utilization for the CSVs and for the anchor handlers.

Brazil continues to offer long-term and project opportunities for both segments, and the same goes for Guyana and also other regions where we operate. We also have to keep in mind that the oil price development that we have seen the last month could introduce some uncertainty going forward. On the backlog, we had an order intake and a book-to-bill ratio of 1.2 in the quarter and 1.3 year to date. That is a strong order intake and increases the visibility into 2026 and beyond. We now have a firm backlog in Solstad Maritime, close to $1 billion, and if we include the options, the number is close to $1.7 billion. Also worth mentioning is that the current backlog we have in Solstad Maritime has an EBITDA margin of approximately 75%. Of the $960 million revenue backlog, the EBITDA backlog is more than $700 million.

We have around $250 million of EBITDA booked for 2026, which gives us a solid foundation entering a new year in a couple of months. As also mentioned, we have reduced our spot exposure in the North Sea for anchor handlers, and that now represents about 8% of total available days in 2026. There are also ongoing tendering activity for some of our CSVs that we have great expectations to, and that potentially could reduce available days in 2026 further and add more to the backlog on the graph to the left. By that, I leave it to you, Kjetil, to take us through some more details on the numbers.

Kjetil Ramstad, CFO, Solstad Maritime: Thank you, Lars. If we start with the financial highlights for Solstad Maritime for the third quarter, it has been a quarter with lower activity for the quarter, 80% utilization for the fleet compared to 89% last year. Year to date, we have a utilization overall of 79%. The lower utilization for the year is mainly driven by a large regulatory docking program for the fleet and in combination with the lower commercial utilization. Revenue for the third quarter was $145 million, compared to $152 million in the third quarter last year. Year to date, we are doing a little bit better than last year for $142 million, compared to $419 million last year. Adjusted EBITDA was $69 million in the third quarter, compared to $91 million last year. Year to date, adjusted EBITDA also better than last year with $229 million versus $220 million.

The net result for the quarter was $32 million, compared to $48 million last year. Firm backlog of $964 million, compared to $755 million last year, is increased of approximately 30%. Book equity at the end of the quarter was $804 million, up from $696 million last year, giving an equity ratio of 48%. Adjusted net interest-bearing debt was $580 million, compared to $617 million last year. This gives a cash of $124 million at the end of the quarter, compared to $214 million last year. As mentioned, the company will distribute approximately $15 million in dividends for the third quarter.

If we take a look at the net debt overview at the right-hand side in the graph, we see that the fleet loan of $686 million per the third quarter, and if we adjust for the accrued interest and the cash, we have an adjusted net interest-bearing debt of $580 million. If we then adjust also and include the leases, we will get a net interest-bearing debt of $608 million. At the bottom, you see the amortization schedule, see that we will repay $65 million in December this year, and we will repay $131 million in 2026 before majority first quarter 2027. If we go to the updated financial guiding, we refer to the stock exchange message on 9th of October 2025. We gave the market an update on the adjusted EBITDA guiding. The full year adjusted EBITDA guidance is at approximately $290 million. The tax payable is unchanged.

The CapEx guidance, we narrowed down to $115 million to $125 million, with maintenance at $95 million to $100 million, and investments to $20 million to $25 million. The net interest and amortization is unchanged in the guiding. If we go to the key dividend dates, there is a proposal to pay dividend for the third quarter of $0.032 per share, totaling approximately $15 million to be paid in NOC. The key date is that the last day to receive dividend is November 7. The ex-date is November 10, record date November 11, and distribution date on or about November 13. With that, I leave the floor to you, Lars Peder, to summarize.

Lars Peder Solstad, CEO, Solstad Maritime: Yeah, thank you, Kjetil. As mentioned, the quarter has been influenced by a lower utilization for the CSV and the anchor handling fleet. This said, the tendering activity we see for 2026 and onwards remains at a high level, indicating several longer-term and project opportunities, especially for the CSV fleet. There are also some interesting opportunities, especially project-related, also to the anchor handling fleet. The fact that the oil price development has been as it has the recent month, we cannot ignore that fact, and that could be a source for uncertainty going forward that we have to take into consideration. Even if we have disappointed earnings in the third quarter, as we have discussed here already, we see that the order intake remains strong.

$180 million in the quarter, which is a 1.2 book-to-bill, is quite good, and that also goes for the year in total, where we are at 1.3, which increases the visibility into 2026. We have $250 million already booked in EBITDA for 2026. If you remember the guidance we have for 2025 of $290 million, it gives a picture of that we are entering an okay year for the company into 2026. We continue to pay quarterly dividends, this time a total amount of $15 million for the quarter. By that, we end our presentation, and we move over to Q&As, and let’s see if there are any questions, Kjetil.

Kjetil Ramstad, CFO, Solstad Maritime: Yeah, we can start with the first question. Is there a step-up in rate for the Norman Vision extensions?

Lars Peder Solstad, CEO, Solstad Maritime: We didn’t report that rate, but it’s fixed on a healthy level, I would say. Also, keeping in mind that this is a contract that has been going on for many years, we are very pleased with the rate that we managed to get for the extension. There are also some mechanisms that could make that contract a longer-term period, as I also mentioned. It’s a good contract.

Kjetil Ramstad, CFO, Solstad Maritime: Thank you. Next question, could you please give some more detail on the current tender activity that you mentioned for the construction support vessels? Which one do you have great expectations for, and which regions is it related to?

Lars Peder Solstad, CEO, Solstad Maritime: If you look at our fleet, the main, let’s say, focus we have to secure longer-term utilization on is mainly on the Norman Sentinel, Navigator, Yarstein, and also the Norman Cutter. On all those vessels, we have interesting discussions going on in various parts of the world. Some are project-related, and some have a longer duration. That is ongoing discussions, and let’s see how that goes.

Kjetil Ramstad, CFO, Solstad Maritime: Thank you. Can you provide some comments on the market balance for the 150 to 250-ton crane vessel in the CSV segment, given the new builds that are coming to market 2026 and onwards?

Lars Peder Solstad, CEO, Solstad Maritime: There are no doubts that there is more competition in the market already. Others, in addition to us, have availability, so it’s a more competitive market already. It’s also a fact, as the question indicates, that there are vessels coming to the market mainly from 2027 and onwards, a few also in 2026, and we are dependent on a higher activity level in the market so that those additions to the fleet can be absorbed in a good way. As I said, there is tender activity in the market. How that balances out remains to be seen.

Kjetil Ramstad, CFO, Solstad Maritime: We go to the next questions. There are seven to eight construction support vessels in the fleet of contract from now until the second quarter 2026. What can you say about the strategies and plans to secure work short term for these vessels?

Lars Peder Solstad, CEO, Solstad Maritime: I think I already answered that question. We have a very strong focus on securing high utilization on our fleet, including the vessels mentioned, and that has a strong focus. As I said, there are several opportunities that we are chasing, and we’re quite optimistic to be able to take our fair share of those opportunities.

Kjetil Ramstad, CFO, Solstad Maritime: Thank you. The next question is, Sigma is arriving soon in Brazil and Sirius will be mobilizing also. What is the timing for those vessels to start working for Petrobras?

Lars Peder Solstad, CEO, Solstad Maritime: As you will probably remember from the update we gave the 9th October, we also said that Petrobras has asked us to deliver earlier than originally planned. That has also a negative consequence of the fourth quarter, as we are doing the mobilization and also some of the spendings in the fourth quarter. We expect to be on hire with one of the anchor handling tug supply vessels in Brazil in January and the other one in February next year.

Kjetil Ramstad, CFO, Solstad Maritime: It’s a question on CapEx. CapEx is almost double this year compared to 2023 and 2024. Can you help us understand how this will look like in 2026?

Lars Peder Solstad, CEO, Solstad Maritime: First of all, 2025 has been an extraordinary year when it comes to CapEx and rider kings. We have had many main classes on some of the more, let’s say, bigger and advanced vessels with the cost associated with that. In 2026, we have much less planned rider kings, so you will see a CapEx level on a completely different level in 2026 compared to what we have had in 2025.

Kjetil Ramstad, CFO, Solstad Maritime: Thank you. There are several questions on the upcoming refinancing, so I can just share some thoughts on that. We will, of course, discuss with the lender group in the fleet loan of Solstad Maritime when appropriate and let the market know the outcome when those discussions are finalized. The next question, and it’s a little bit the same, but can you give an update on the current subsea contracts and pricing? How do you see the market develop into 2026?

Lars Peder Solstad, CEO, Solstad Maritime: Yeah, I think I covered most of it. On the rate level, of course, the higher competition, the more pressure on the day rates. What we have seen so far is that the rate level has been still on a decent level. What we see from discussions we have with clients and so on as well is that it looks like the rate levels will continue to be on a quite okay level also going into next year.

Kjetil Ramstad, CFO, Solstad Maritime: Thank you. A lot of questions today. One about Petrobras. There have been some comments recently about Petrobras contacting suppliers to discuss how together they can cut costs. Have Solstad Maritime seen any of these requests?

Lars Peder Solstad, CEO, Solstad Maritime: We have had our meetings as well. To me, it’s very constructive discussions. It’s about, are there anything we in common can do? I would say, yeah, the discussions have been very constructive and sort of no red light at all. We are a very large client of Petrobras and have fruitful discussions, I would say, with them. That’s what I can mention on that subject.

Kjetil Ramstad, CFO, Solstad Maritime: Thank you. That was the last question.

Lars Peder Solstad, CEO, Solstad Maritime: Thank you very much for listening in and have a nice day ahead. Thank you.

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