Q3 2021 Golden Ocean Group Ltd Earnings Call
[music].
Good day and thank you for standing by welcome to the third quarter 2021, Golden Ocean Group Limited earnings Conference call.
At this time all participants are in listen only mode. After the speaker's presentation there'll be a question and answer session to ask a question you will need to press star one on your telephone.
Please be advised today's conference is being recorded.
If you require in the fall that assistance. Please press star zero and I would now like to hand, the meeting over to your speakers today in order to make them. The sudden. Please go ahead.
Good afternoon, everyone.
Come to this Q3 release.
Name is Oregon, Anderson and next to me I have got a few months and our CFO.
Today, you have to give you insight on outlook inside into how Golden Ocean has been doing and what we're expecting in the near future.
Your message for this release as a strong and solid financial performance combined with a time to catch up Q1 next year.
Basically what we will show you during the next 15 to 20 minutes is that we have capitalized on the strong Q3.
While securing attractively priced forward cover.
We continue to pay out a significant portion of our net profit in dividend.
And that the supply and demand fundamentals remain in place for a sustained period of profitable markets.
On that note, let's take a look at the main highlights for the quarter.
We recorded an EBITDA just shy of 230 million, which translated into a net income of $195 million. All 97 cents per share. We also entered into an agreement for the construction of seven comes from Axis.
Securing new vessels have allowed us to divest older tonnage and this quarter, we sold two vessels at attractive prices.
Our strategy is to continue to divest our oldest tonnage.
We also completed the refinancing of the starting of facility on very favorable terms, reducing our cash breakeven at the same time.
We reported TCE rates of $38100 per day for the Capes and 24700 for the Panamaxes.
Looking at this quarter Q4, we have so far secured $42000 per day for 82% of our Cape days and $27000 per day for 86% of all Panamax days and.
In other words Q4 has the potential to be better than Q3.
Looking into next year, we have secured approximately 33000 per day for 30% of our Cape days.
And approximately $24000 per day for 36% of our Panamax days.
Finally, we announced a dividend of 85 cents per share.
This is our third quarterly payout and it will take the 2021 dividends to $321 million.
Now, let's dive into the numbers in details and have a closer look at the Q3 financials, Peter but what's your view. Please thank you Rick.
We recorded Q3 time charter revenues of $307 million, which was up by $94 million from the previous quarter.
We are a strong uplift in all segments.
Rick mentioned, a TCE rates of $38000 for for Capes and 25 for the Panamaxes.
Europe, respectively, 6009 thousand for the Panamaxes and capes compared to the previous quarter.
Total TCE rate of 32003 hundred.
Versus 24900 in Q2.
We are at one ship dry dock in in this quarter versus three ships in Q2.
Which resulted in an off hire days of 0.9% or 85 days versus 150 days in Q2.
Looking at the Opex really.
Recorded 52.4 million versus $50 3 million in Q2.
This was a slight increase in and running opex, but adjusted downwards by fewer ships Drydock this quarter.
We continue to see COVID-19 impacting our our operating expenses, which we estimate to around $350 per day.
Impact in Q3.
Mainly relating to crew changes and quarantining hotels.
Our general and administrative expenses, we recorded $4 6 million in Q3, which is equal to what we recorded in the previous quarter.
Where we maintain the best in industry cost level.
This equals $500 per day and G&A costs.
And most impacted also by a 900 its house in our profit sharing accrual or $100 per day.
Impact.
Our charter hire expense.
Was down from 33 million to 31 million this quarter, which.
Mostly reflect that we took delivery of the Herman fleet during Q2.
Of which many ships have been chartered in previous quarter.
This was offset by higher rate levels on chartering in tonnage and higher trading activity.
This appreciation was also impacted by addition of new ships during Q2.
As well as our net financial expenses, where we saw a higher average debt level.
Stemming from the new ships entering the fleet.
Although derivatives and other financial income, we recorded a positive $16 7 million results.
Which.
Mainly relates to derivative increase in mark to market positions of $5 6 million versus $14 6 million in Q2.
All of this.
Our FSA portfolio increased by $5 1 million.
Our interest rate portfolio increased by four.
$6 million.
Our results from associates.
Mainly related to an increase of $11 3 million.
For our investment in dry bulk operators with marine.
And of total.
Positive results and results from associates of $11 1 million.
Our marketable securities was down by <unk> 4 million.
Which relates to our <unk>.
Sure holding in and that's it.
This resulted in a net profit of $195 3 million or 97 cents per share versus $104 5 million and 52 cents per share in Q2.
And as Rick mentioned, a dividend was declared Oh 85 cents per share for the quarter.
Moving to the next slide we can look at our cash flow, where we can see recorded a cash flow from operations of $200 5 million in Q3.
This is a result of more ship days.
On higher rate levels recorded in the quarter.
Our cash flow used in financing and investments with net.
$102012 9 million.
Which.
Largely relates to a positive cash flow from refinancing of the Downer facility.
Amounting to $15 million net of financing fees.
Further the 34 million scheduled debt and release repayment was recorded in the quarter.
And finally.
We paid out 800 million in dividend relating to the second quarter results.
Okay.
Looking at our balance sheets, we have had a cash position of 60 to $262 5 million, which includes the 20 million restricted cash balance, which secures our interest rate and FSA derivatives portfolio.
We had total debt and lease liabilities of $1 5 billion.
And book equity of 1.9 billion.
Which based on the total assets.
$3 5 billion.
It's a ratio of equity to total assets of approximately 54%.
Moving to the next slide.
We can look at the overview of all of our debt maturities and Capex.
For the coming years.
As you can see we have no debt maturities until mid 2023.
And thereby thereafter.
Evenly distributed over the coming years.
With.
Strong liquidity and balance sheets, and a strong banking group.
With the new banks to the recent financings and very low leverage averaging 43% loan to value on our fleet. We expect that these maturities will be refinanced at very attractive terms.
Looking at our Capex, we have put in orders for seven more than it comes to Max ships that will deliver from mid 'twenty 'twenty three.
This is part of our fleet renewal program, where we also sold off.
Poor ships during the year.
Predominantly in our older Panamax segments.
We have.
To date. This report paid one third of the estimates equity Capex for the ships and we will continue to opportunistically seek to divest older tonnage.
With that I give the word back to Rick.
Thank you Peter.
Now all of a sudden the attention to the market development in Q3 on slide number 10.
Q3 was a positive quarter with a utilization rate reaching 98%.
This is the highest level, we've seen in more than a decade.
Naturally this firmed up the market, which increased steadily throughout the quarter for both segments.
The three main drivers were the.
The continued inefficiencies and congestion.
Our strong growth in the core trade.
Rising Brazilian iron ore shipments.
Looking ahead, we remain very bullish for what lies ahead.
Q3 was a good quarter, but that's all right I rate guidance indicated Q4 has the potential to be even better.
In fact, the stage is set for a prolonged period of solid demand growth for dry bulk commodities well into 'twenty to 'twenty, two and bill and beyond.
GDP growth is a good proxy for dry bulk demand. It just keeps you remember that for the past 20 years on average per year. The demand for dry bulk shipping has been growing 20, 20% more than the world GDP growth.
Even if GDP growth is tempering of slide to next year. It is firstly compared to an exceptionally strong 2021, and secondly, still growth rates that are high compared to the historic average.
And all of you the anticipated growth will continue to support a strong freight environment.
So.
We face what looks like a favorable demand side, but what about the other side of the equation the supply side well. The order book currently sits at no less than a third yellow in recent years ordering has been muted and it now coincides with a period of strong demand growth.
Going forward, we do not see ordering picking up the prices are at a historical high level why there's no clarity on what propulsive technology is truly future proof.
It is in any case. Unlike did you get new opening slots before the very end of 2023.
It gives us a runway of minimum two years with very modest fleet growth.
So when we combined the anticipated supply growth with the anticipated demand growth on slide number 20, author T. Much point to an extended period of sustainable earnings.
Lori a dry bulk has the past 18 to 20 months about demand.
Driven by the massive stimulus that has been employed by governments around the world.
But we see that is about to change the stimuli will naturally temper off over the coming six to 12 months and the growth will return to a normalized level in 'twenty to 'twenty, two and 'twenty to 'twenty three.
But because the fleet growth is de accelerating hot demand even at normalized levels, we'll still comfortably grow faster than the supply.
That we are changing from a demand story to a supply story is positive since 1991, the demand for dry bulk shipping has been growing by an average of 3.9% per year.
And only two years in that period did you detect during the financial crisis in 2008.
During Covid and 2020.
In other words it is normally the oldest building too many vessels, which causes the market to come under pressure not the lack of demand.
At this time the supply side is well under control at least for the next two years, but likely for longer.
Turning your attention to the near term future Golden Ocean has been active in the past six three to six months.
We have secured a large portion of high fixed paying GC deals to mitigate risk secure dividend capacity and built a bridge between the usually weaker Q1 and the rest of the year.
As of today, we have four Q1 next year, 30% of the Cape fleet fixed around $33000 per day, and 36% of our Panamax fleet fixed at around $24000 per day.
And mind you all these are net figures.
It means that for Q1, we currently have contracted $73 million of TCE revenue.
32% of our fleet.
On the last two slides a day, we will focus on cash flow generation.
Through well timed acquisitions economies of scale and access to competitive finance, we have achieved industry low cash breakeven on our fleet.
Our average cash breakeven is 12700 for the Capes and 8500 for the Panamaxes.
The cash breakeven is all in and includes amortization interest and G&A.
As it appears on the right hand side I'll break even allows for strong earnings in todays market, but at the same time. It also acts as downside protection.
The Cape market for instance has not been below our cash breakeven levels for very long in the past five years.
With our low Cal.
It's broke even in the strong market outlooks Golden Ocean Castro potential is substantial.
Monday this week, the blended average of Cape and Panamax rates, reflecting our ratio of Capes and panamax vessels was around $25000 per day.
On an annualized basis that means generating almost 500 million dollar over our cash breakeven or a yield of more than 30% on Monday share price.
It's a board decision, what we will do with future earnings, but we have made no secret of our policy of paying back to all shareholders a significant portion of our net profits.
Something we have to live it on in the first three quarters of the year paying off $321 million.
Before opening up for questions I'd like to shop to wrap up the three main points from this release.
Golden Ocean capitalized on the strong Q3 market, making almost $200 million in net profit.
Golden Ocean has timely secured $73 million of TCE revenue for Q1 next year.
Thereby breaching the usually the weakest quarter of the year.
Golden Ocean is well on track and expect 2021 to be the most profitable ever in the history of the company.
And now we start the Q&A session I, therefore hand, the word back to the operator. Thank you.
Thank you ladies and gentlemen, we will now begin the question and answer session.
If you'd like to ask a question. Please press star one on your telephone.
Wait for your name to be announced.
Can come to your request anytime by pressing a husky.
Once again it is star and one final question.
I have a question from the line of.
Well, yeah I'm afraid.
Go ahead.
Yes, good morning fantastic quarter congratulations.
Yeah.
The question I have a couple of questions.
On the Perry cover Oh, I see you have about 30% to 35% in Q1 does any of that extend into Q2.
Yes.
That's a that's a portion of that that extends into a into a into Q2 as well.
Roughly about half.
Okay.
Bob.
I had a couple of pay offs.
In the last quarter.
Who oh.
All of the older vessel.
Yes that is very much dear sorry, yes.
Yeah.
Okay.
So.
Cool.
Yeah, the Lumpiness, a little bit before but then I heard your question you asked if we were going to divest more vessels going forward and the answer to that is yes.
We are looking to to divest are the oldest telling us we have been there in the fleet are primarily all of Panamax vessels.
Okay. Thank you and.
One other question on the period covered.
Do you plan on keeping me up here recover into 2022.
I don't know a level of 45% to 35% to or how do you feel about that.
Going forward throughout the year.
I think it is too soon to say what we'll do for next year I think the.
The plan, we have made here has been to get through this year with the.
Maximum capitalization on the crude markets, while preparing for the for the for the for the first quarter.
As we speak today are these.
These numbers that we have achieved for Q1.
Not no pause.
Possible to achieve any longer so we feel that that is not value and tapping into a into that now. So the position. We have right. Now we are happy about and we are we are confident going into into Q1 with that.
Then we will revisit the wording.
The market hopefully as we expect it will it picks up.
From Oh furniture in Q1 or the end of Q1 during Q2 and then yes, we will continue.
Continue to take a comma.
As and when we see it as a it is a good price and if it was just a risk, but how much and how little I kind of sit and say here today.
Okay.
Regarding the scrubbers.
Wastewater treatment system.
As the fleet of 100%.
Have scrubbers and waste treatment systems or.
Are there any more vessels.
No we have we have.
Let's see here, we have 33.
All of our capes fitted with scrubbers.
Scrubbed those and <unk>.
That's good thank.
They gave us usually.
And any extra earnings a couple of thousand per day, but we don't deem scrub us as a technology for the future. So it's not something we're going to invest more and if we are investing or when we are going to invest in upgrades of the vessels, we will look quite different.
The solution so that it also bringing down emissions at the same at the same time.
Okay, I appreciate that and again fantastic quarter and performance it instead of hope for a good fourth quarter and well into next year. So again, thank you very much.
You might call have a nice holiday.
Thank you. Thank you for thank you for accordingly.
Yep.
Thank you once again, it is star and one for any questions.
And at this time, we will have no further questions. Please continue.
Okay. Thanks, everyone for dialing in.
And.
We will hope to hear you all in the next quarter as well. Thank you. Thank you.
That concludes presentation today. Thank you for participating you may disconnect.
Cool.
Yes.
[music].
Okay.
[music].
Hum.
[music].
Yes.
[music].
Okay.
Okay.
Okay.
[music].
Yes.
[music].
Yes.
[music].
Yes.
[music].
Okay.
[music].
Okay.
Yeah.
Yes.
[music].
Okay.
[music].
Okay.
Yes.
Yeah.
[music].
Okay.
[music].
Okay.
Okay.
Okay.
[music].
Okay.
[music].
Okay.
[music].
Yeah.
[music].
Good afternoon, everyone.
Come to this Q3 release my name is Orrick Anderson and next to me I have paid as he mentioned our CFO.
Today, you have to give you insight on outlook insight into how Golden Ocean has been doing and what we're expecting in the near future.
The overall message for this release as a strong and solid financial performance combined with a time to catch up Q1 next year.
Basically what we will show you during the next 15 to 20 minutes is that we have capitalized on the strong Q3.
While securing attractively priced for what Cabo.
We continue to pay out a significant portion of our net profit in dividend.
And that the supply and demand fundamentals remain in place for a sustained period of profitable markets.
On that note, let's take a look at the main highlights for the quarter.
We recorded an EBITDA just shy of 230 million, which translated into a net income of $195 million. All 97 cents per share. We also entered into an agreement for the construction of seven comes from Axis sick.
Securing new vessels have allowed us to divest older tonnage and this quarter, we sold two vessels at attractive prices.
Our strategy is to continue to divest our older tonnage.
We also completed the refinancing of certain facility on very favorable terms, reducing our cash breakeven at the same time.
We reported TCE rates of $38100 per day for the Capes and 24700 for the Panamaxes.
Looking at this quarter Q4, we have so far secured $42000 per day for 82% of our Cape days and $27000 per day for 86% of our Panamax days and.
In other words Q4 has the potential to be better than Q3.
Looking into next year, we have secured approximately 33000 per day for 30% of our Cape days.
And approximately $24000 per day for 36% of all Panamax days.
Finally, we announced a dividend of 85 cents per share.
This is our third quarterly payout and it will take the 2021 dividends to $321 million.
Now, let's dive into the numbers in details and have a closer look at the Q3 financials. Peter what would you. Please thank you Rick.
We recorded Q3 time charter revenues of $307 million, which was up by $94 million from the previous quarter.
We had strong uplift in all segments.
Rick mentioned, a TCE rates of $38000 for Capes and 25 for the Panamaxes.
Europe, respectively, 6009 thousand for the Panamaxes and capes compared to the previous quarter.
Total TCE rate of 32300 <unk>.
It was 24900 in Q2.
We are at one shift dry dock in in this quarter versus three ships in Q2.
Which resulted in an off hire days of 0.9% or 85 days versus 150 days in Q2.
Looking at the Opex really.
Recorded $52 4 million versus $50 3 million in Q2.
This was a slight increase in running opex, but adjusted downwards by fewer ships Drydock this quarter.
We continue to see COVID-19 impacting our our operating expenses, which we estimate to around $350 per day.
Impact in Q3.
Costs, mainly relating to crew changes and according to your hotels.
On our general and administrative expenses, we recorded $4 6 million in Q3, which is equal to what we recorded in the previous quarter.
Where we maintain the best in industry cost level.
This equals $500 per day and G&A costs.
And what's impacted also by a 900 its house in our profit sharing accrual or $100 per day.
Impact.
Our charter hire expense.
Was down from 33 million to 31 million this quarter, which.
Mostly reflect that we took delivery of the Herman fleet during Q2.
Of which many ships have been chartered in previous quarter.
This was offset by higher rate levels on chartering in tonnage and higher trading activity.
The depreciation was also impacted by addition of new ships during Q2.
As well as our net financial expenses, where we saw a higher average debt level.
Stemming from the new ships entering the fleet.
Although our derivatives and other financial income we recorded a positive $16 7 million results.
Which.
Mainly relates to derivative increase in mark to market positions of $5 6 million versus $14 6 million in Q2.
All of this.
Our FSA portfolio increased by $5 1 million.
Our interest rate portfolio increased by four.
$6 million.
Our results from associates.
Mainly related to an increase of $11 3 million.
For our investment in dry bulk operators with marine.
And a total.
Positive results in results from associates of $11 1 million.
Our marketable securities was down by <unk> 4 million.
Which relates to our <unk>.
Sure holding and that's it.
This resulted in a net profit of $195 3 million or 97 cents per share versus $104 5 million and 52 cents per share in Q2.
And as Rick mentioned, a dividend was declared Oh 85 cents per share for the quarter.
Moving to the next slide we can look at our cash flow, where we can see recorded a cash flow from operations of $200 5 million in Q3.
This is the result of more ship days.
On higher rate levels recorded in the quarter.
Our cash flow used in financing and investments.
It was $112 9 million.
<unk>.
Largely relates to a positive cash flow from refinancing of the Downer facility.
Amounting to $15 million net of financing fees.
Further a $34 million scheduled debt and release prepayments was recorded in the quarter.
And finally.
We paid out a 100 million in dividend.
Waiting to the second quarter results.
Yeah.
Looking at our balance sheets, we have had a cash position of 60 to $262 5 million, which includes the 20 million restricted cash balance, which secures our interest rate and FSA derivatives portfolio.
We had total debt and lease liabilities of $1 5 billion.
And book equity of 1.9 billion.
Which based on the total assets.
$3 5 billion.
The ratio of equity to total assets of approximately 54%.
Moving to the next slide.
We can look at the overview of all of our debt maturities and Capex.
For the coming years.
As you can see we have no debt maturities until mid 2023.
And thereby thereafter.
Even the distributed over the coming years.
With.
Very strong liquidity and balance sheets, and a strong banking group.
With the new banks to the recent financings and very low leverage averaging 43% loan to value on our fleet. We expect that these maturities will be refinanced at very attractive terms.
Looking at our Capex, we have put in orders for seven modern ships.
We will deliver from mid 'twenty, two or three.
This is part of our fleet renewal program, where we also sold off.
Ships during the year.
Predominantly in our older Panamax segments.
We have.
To date. This report paid one third of the estimates equity Capex for the ships and we will continue to.
Opportunistically seek to divest older tonnage.
With that I give the word back to Rick.
Thank you Peter.
Now, let's turn the attention to the market development in Q3 on slide number 10.
Q3 was a positive quarter with a utilization rate reaching 98%.
This is the highest level, we've seen in more than a decade.
Naturally this firmed up the market, which increased steadily throughout the quarter for both segments.
The three main drivers were the.
The continued inefficiencies and congestion.
Our strong growth in the core trade and <unk>.
Rising Brazilian iron ore shipments.
Looking ahead, we remain very bullish for what lies ahead.
Q3 was a good quarter, but that's all right I rate guidance indicated Q4 has the potential to be even better.
In fact, the stage is set for a prolonged period of solid demand growth for dry bulk commodities well into 2022 anvil and beyond.
GDP growth is a good proxy for dry bulk demand. It just keeps you remember that for the past 20 years on average per year. The demand for dry bulk shipping has been growing 20, 20% more than the world GDP growth.
Even if GDP growth is tempering of slightly next year. It is firstly compared to an exceptionally strong 2021, and secondly still growth rates that are high compared to the historic average.
And all of you the anticipated growth will continue to support a strong freight environment.
So.
We face what looks like a favorable demand side, but what about the other side of the equation the supply side well. The order book currently sits at no less than a third yellow in recent years ordering has been muted and it now coincides with a period of strong demand growth.
Going forward, we do not see ordering picking up the prices are at a historical high level why there's no clarity on what propulsion technology is truly future proofs.
It is in any case. Unlike did you get new building slots before the very end of 2023.
It gives us a runway of minimum two years with very modest fleet growth.
So when we combine the anticipated supply growth with the anticipated demand growth on slide number 20, Saatchi much point to an extended period of sustainable earnings.
We have dry bulk has the past 18 to 20 months about demand.
Driven by the massive stimulus that has been employed by governments around the world.
But we see that is about to change the stamina will naturally temper off over the coming six to 12 months and the growth will return to a normalized level in 'twenty to 'twenty, two and 'twenty to 'twenty three.
But because the big growth is de accelerating hot demand even at normalized levels, we'll still comfortably grow faster than the supply.
That we are changing from a demand story to a supply story is positive since 1991, the demand for dry bulk shipping has been growing by an average of 3.9% per year.
And only two years in that period did you detect.
During the financial crisis in 2008 during Covid and 2020.
In other words it is normally the owner spilling too many vessels, which causes the market to come under pressure not the lack of demand.
This time the supply side is well under control at least for the next two years, but likely for longer.
Turning your attention to the near term future Golden Ocean has been active in the past six three to six months.
We have secured a large portion of high fixed paint GC deals to mitigate risk secure dividend capacity and built a bridge between the usually weaker Q1 and the rest of the year.
As of today, we have four Q1 next year, 30% up the Cape fleet fixed around $33000 per day, and 36% of our Panamax fleet fixed at around 24000 dollar per day.
And mind you all these are net figures.
It means that for Q1, we currently have contracted $73 million of TCE revenue.
32% of our fleet.
On the last two slides a day, we will focus on cash flow generation.
Through well timed acquisitions economies of scale and access to competitive finance, we have achieved industry low cash breakeven on our fleet.
Our average cash breakeven is 12700 for the Capes and 8500 for the Panamaxes.
The cash breakeven is all in and includes amortization interest and G&A.
As it appears on the right hand side I'll break even allows for strong earnings in todays market, but at the same time. It also acts as downside protection.
The Cape market for instance has not been below our cash breakeven debits very long in the past five years.
With our low <unk>.
Let's break even in the strong market outlooks Golden Ocean Castro potential is substantial.
Monday this week, the blended average of Cape and Panamax rates, reflecting our ratio of Capes and panamax vessels was around $25000 per day.
On an annualized basis that means generating almost 500 million dollar over our cash break even or a yield of more than 30% on Monday share price.
It's a board decision, but we will do with future earnings, but we have made no secret of our policy of paying back to all shareholders a significant portion of our net profits.
Something we have delivered on in the first three quarters of the year paying out $321 million.
Before opening up for questions I'd like to shop to wrap up the three main points from this release.
Golden Ocean capitalized on the strong Q3 market, making almost $200 million in net profit.
Golden Ocean has timely secured $73 million of TCE revenue for Q1 next year.
Thereby breaching the usually the weakest quarter of the year.
Golden Ocean is well on track and expect 2021 to be the most profitable ever in the history of the company.
And now we start the Q&A session I, therefore hand, the word back to the operator.
<unk>.
Thank you ladies and gentlemen, we will now begin the question and answer session.
Linda if you like to ask a question. Please press star one on your telephone.
Wait for your name to be announced.
Okay.
Yes.
By pressing a husky once again it is star and one final question and we have a question from the line of.
William I'm afraid.
Please go ahead.
Yes, good morning fantastic quarter congratulations.
Yeah.
Yeah. The question I have a couple of questions.
On the Perry cover Oh, I see you have about 30% to 35% in Q1 does any of that extend into Q2.
Yes.
That's a that's a portion of that but extends into a into a into Q2 as well.
Roughly about half.
Okay.
Uh huh.
I had a couple of fail.
In the last quarter.
We had to pull all the kidney.
The older vessel.
Yes that is very much there, yes, sorry, yes.
Yeah.
Fall off the table.
So.
Yeah. The the long is a little bit for one thing, but as I heard. Your question. You asked if we were going to divest more vessels going forward and the answer to that is yes.
We are looking to to divest.
The oldest tonnage we have been there in the fleet.
Primarily all of Panamax vessels.
Okay. Thank you.
One other question on the pure read cover.
Do you plan on keeping me up here recover into 2022 at a I don't know a level of 45% to 35% or how do you feel about that.
Going forward throughout the year.
I think it's too soon to say what we'll do for next year I think the yeah.
The plan, we have made here has been to get through this year with the.
Maximum capitalization on the crude markets, while preparing for the for the for the for the first quarter.
As we speak today are these.
These numbers that we have achieved for our Q1.
I am not.
Possible to achieve any longer so we feel that that is not value and dipping into a into that now. So the position. We have right. Now we are happy about and we are we are confident going into into Q1 with that and then we will revisit our win.
The market hopefully as we expect it will it picks up.
From Oh furniture in Q1 or the end of Q1 during Q2 and then yes, we will continue to take.
Carla.
As and when we see it as a it is a good price and if it was just a risk, but how much and how little I kind of sit and say here today.
Okay.
Regarding the scrubbers.
Waste.
Duo is the fleet of 100%.
Have scrubbers and the least critical systems or are there any more vessels.
I know we have we have.
Let's see here, we have 33.
All of our capes fitted with scrubbers.
Scrubbed those.
And then.
That's good so happened that gave us usually.
And any extra earnings for a couple of thousand per day, but we don't deem scrub us as a technology for the future. So it's not something we're going to invest more and if we are investing or when we are going to invest in upgrades of the vessels, we will look quite different.
Solutions that are also bringing down emissions at the same at the same time.
Okay, I appreciate that and again fantastic quarter and performance it is very.
For a good fourth quarter and well into next year. So again, thank you very much.
My call.
This holiday.
Thank you. Thank you for thank you for calling in.
Yep.
Thank you once again is a stall and one for any questions.
And at this time, we will have no further questions. Please continue.
Okay. Thanks, everyone for dialing in.
And.
We will hope to hear you dialing in the next quarter as well. Thank you. Thank you.
Yeah.