SFL corp report Q4 2024

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02/12
Seems like shipping related entities are continuing to report Q4 results earlier than usual - SFL reported earlier today.

  • Rev of $232M
  • Net income of $20.2M
  • Q4 div of 27c/sh (maintained)

https://ml-eu.globenewswire.com/Resource/Download/a462a9f3-a3a0-4932-a0c0-fc711f552f8c

Since the offshore drilling assets have a slightly different revenue recognition computation, I am guessing some of Hercules revenue recognition spilled into Q4 2024. The rig itself spent Q4 in Norway, after wrapping up its drilling activity in Canada. Warm-stacked or cold-stacked? No idea.

Lots of moving pieces and subsequent events

  • Court judgement wrt Hercules in SFL’s favor. Court awards SFL $48M
  • SFL continue making equity payments on new vessels
  • SFL issued a new $150M bond. I’m guessing, some of it repays an older bond

[Edit: Probably should have also included adj EBITDA earnings of $132M. That indirectly shows the deterioration of things to end with a net of $20M

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The SFL Earnings Call has a few more details.

  • The Hercules court case is not final. Seadrill could still appeal and the final settlement might take up to a year.
  • SFL mgmt not too optimistic on new work for Hercules H1 2025. However, the company is considering additional upgrades to the rig. This will make it more marketable AND is cheaper than the cost of stacking.
  • I had forgotten about the 8 Capes. Golden Ocean (GOGL) financed that deal as a sale & leaseback. The buy-back terms favor GOGL - IIRC, GOGL re-acquires each vessel for $10M. The vessel are probably worth about $15M - $20M each
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