Q2 2026 Stena AB Earnings Call
Speaker #1: Let's ask a question during the Q&A portion of today's call. You may do so by pressing Star followed by 1 on your telephone keypad if you've joined us via the phone.
Speaker #1: Alternatively, if you're joining us online, please use the Q&A text box provided. And I will now hand the floor to Peter Claesson to begin.
Speaker #1: So, Peter, please go ahead.
Speaker #2: Thank you, Adam. And welcome, everyone, to the Q2 2026 financial update from us here at Stena. And hopefully you have access to the slides and, as usual, I will run through those pretty quickly and then open up for Q&A.
Speaker #2: And let's start with slide number 3, with our 5 business areas: ferries, offshore drilling, and shipping. And then property and adductum. And in the bars below, you can see the revenue and EBITDA split per business area for the last 12 months.
Speaker #2: And during this period, revenues from operations—excluding net gains on asset sales—and changes in fair value of investment properties amounted to 53.4 billion SEK. EBITDA from operations excluding other came in at 12.7 billion.
Speaker #2: And with that, let's go into slide number 4, with the profit and loss statement for the half year. And as you can see, it's a very strong—it's an isolated, a very strong quarter, and also the half-year figures is very strong.
Speaker #2: You can see that revenue is up by 3 billion—3.2 billion to 28 billion Swedish kronor. We have sold a couple of vessels during the time period, resulting in net gains on sales of assets of 918, an improvement or a higher figure by 462 million SEK.
Speaker #2: Also, in our property business area, we have finished projects that lead to a valuation uplift of 356 million in the period. EBITDA: 7.1 billion, an improvement of around 1.6 billion Swedish kronor.
Speaker #2: You can also see that we have a shortly improved financial net—so financial net minus 1.2 billion—an improvement of 320 million. And on earnings, before tax, of 2.274 billion Swedish kronor versus 485 million in the same period in 2025, an improvement of almost 1.8 billion SEK.
Speaker #2: Slide number 5, you can see an explanation also operationally to why we show good figures. Ferry operations: a slight improvement, despite some loss in volume from the existing business during the period.
Speaker #2: Offshore drilling: more days on contract, an improvement. Rural, as planned, basically we sold off a couple of assets during last year, and that means that EBITDA is lower and that will be kind of remedied with the coming deliveries.
Speaker #2: And then you see Stena Bulk: 1.2 billion for the period, an improvement of 562 million in a very, very strong—I would call it even hot—tanker market.
Speaker #2: Real estate: growth by 250 million, boosted by the acquisition of Shellfelt last year. To 1.—almost 1.4 billion Swedish kronor. And adductum: approximately unchanged from last year, bringing EBITDA from operations to 5.840 billion Swedish—an improvement by 835.
Speaker #1: See an explanation also, operationally, as to why we show good figures. Perry operations: a slight improvement, despite some loss in volume from the existing business.
Speaker #1: And then we have a couple of unsecured facilities, with the first one actually maturing in 2027. We will look to term that out, and also, after that— I guess sometime during 2027— we will also term out the $2 billion unsecured line, if we still feel that we need it at that time.
Speaker #2: And then you put on the net gain on sales of assets and the fair value of investment properties; they are at 7 billion and 1.6 billion improvement.
Speaker #1: During the period, offshore drilling: more days on contract, an improvement. Ruru, as planned, basically. Like, they knock it. So that will be turned out, most probably, to 2032.
Speaker #1: But I think we have a very comfortable maturity profile, as you can see from this slide. The next slide is our liquidity position, and it's very strong: SEK 20.4 billion.
Speaker #2: So all in all, a very strong period for Stena Group. Slide number 6: the committed capex. We have primarily ferries, in this order book, and you can see below in the bars that the committed capex for new buildings on order as of 30 June is a total of 3.6 billion.
Speaker #1: Consisting of cash, unused credit lines, and holdings of securities. You can see the mix in the circle there. With that, let's move into the business segment review.
Speaker #2: And you can see the order—you can see the mix in time below in the bar. Slide number 7: our debt maturity profile, and we have, as you know, worked a lot with terming out our maturities and that means that we have a quite a good position, I think, in our capital structure with our first major maturity currently in 2030.
Speaker #1: And also, starting with Stena Line on slide number 10. And you can see that we are stable. And we are in a— growth has been sluggish in Europe, and I think it is— I think it's a strong performance by Stena Line that balances a slight loss in volumes on the core business.
Speaker #1: The reason why it's zero here is because it includes Vasa Line, our latest acquisition of one ferry route up in the north of Sweden, between Sweden and Finland.
Speaker #2: That is a—that is our revolver, that matures in 2030, and we have 2 prolongation options. So this year we will prolong it to 2031, and next year hopefully we'll prolong it to 2032.
Speaker #1: If you exclude Vasa Line, we are down a couple of percent in Travel, and about 1% in Trade. That has been made up by higher margins.
Speaker #2: So the prolongation is by consent from our banks, which I don't see why they would not give. So that will be termed out most probably to 2032.
Speaker #1: Also, we have announced previously that we will close down the route between Halmstad and Grenå, and that has had some one-off costs, but that will be kind of compensated by a better margin from the total operation.
Speaker #2: And then we have a couple of unsecured facilities that we—with the first one, actually maturing in 2027, we will look to term that out and also after that, I guess, some time during 2027 we will also term out the 2 billion unsecured line, if we still feel that we need it at that time.
Speaker #1: Yeah, I think I'll stop there and go to the next slide, number 11. There you can see the volume figures, and as with the last slide, it includes Vasa Line.
Speaker #2: But I think a very comfortable maturity profile as you can see from this slide. Next slide is our liquidity position, and it's very strong: 20.4 billion SEK.
Speaker #1: And then on slide number 12, you can see the route network. Please note that the line between Halmstad and Grenå was discontinued in April 2026.
Speaker #2: Consisting of cash, unused credit lines, and holdings of securities. You can see the mix in the circle there. With that, let's move into the business segments review.
Speaker #1: Then, moving on to Stena Drilling, I think the good news there is that the market seems to be picking up. The market is a little bit tighter, especially for 6th-generation rigs in terms of utilization.
Speaker #2: And also, starting with Stena Line on slide number 10, and you can see that we are stable. And we are in a—growth has been sluggish in Europe, and I think it is—I think it's a strong performance by Stena Line, that balances a slight loss in volumes on the core business.
Speaker #1: We are very happy that we have a new contract for Stena Drillmax, and we had—maybe we had feared that we wouldn't get a contract this side of the new year, and I think that's a bonus that we get one, which will start to commence in the fourth quarter.
Speaker #2: The reason why it's 0 here is because it includes Vasa Line, or latest acquisition of a 1 ferry route up in the north of Sweden, between Sweden and Finland.
Speaker #1: Then also, to report, is that we will start the upgrade to a 20,000 vessel of Stena Evolution, and that will be done throughout this autumn.
Speaker #2: If you exclude Vasa Line, we are down a couple of percent in travel, and about 1% in freight. And that has been made up by higher margins.
Speaker #1: Contract coverage, slide number 14. We continue with Caron. Caron has been working for Exxon since 2016 and is on a greenfield contract, enjoying pretty good rates in the market.
Speaker #2: Also, we have announced previously that we will close down the route between Halmstad and Grenå, and that has had some one-off costs, but that will be kind of compensated by a better margin from the total operation.
Speaker #2: Yeah, I think I'll stop there and go to the next slide, number 11, where you can see the volume figures and, as with the last slide, it includes Vasa Line.
Speaker #2: And then on slide number 12, you can see the route network, and then please note that the line between Halmstad and Grenå was discontinued in April of 2026.
Speaker #2: Then moving on to Stena Drilling, and I think the good news there is that the market seems to be picking up. The market is a little bit tighter, especially for 6th generation rigs in terms of utilization.
Speaker #2: We are very happy that we have a new contract for Stena Drillmax, and we had—maybe we had feared that we wouldn't get a contract this side of the new year, and I think that's a bonus that we get one, which will start to commence in the fourth quarter.
Speaker #2: Then also, to report, is that we will start the upgrade to a 20K vessel of Stena Evolution, and that will be done throughout this autumn.
Speaker #2: Contract coverage, slide number 14, we continue with Caron. Caron's been working quite strong since 2016, and is on a greenfield contract with enjoying pretty good rates in the market.
Speaker #2: Drillmax, Shell Namibia, and then energy in Greece, and energy in Israel, and then an option in 2028. Stena Ford currently working in Egypt, going to Namibia, and then we have—we believe we have a contract, it's not signed, but we have agreed a contract commencing in 20—yeah, maybe late 2026 or beginning of 2027.
Speaker #2: And then running for 2 years. ICEMAX also various clients going forward, but looks to be fully occupied with the exception of the special periodic survey in 2027.
Speaker #2: Stena Dawn working for Alura, and that seems to be a quite a long commitment, and then Stena Evolution is working for Shell for the foreseeable future.
Speaker #2: So it looks like 2027 will be a year when we are fully employed, obviously subject to utilization of various options, but we're positive and hopeful that—and we really believe that these will be utilized, and that we will see a good year in 2027 for drilling.
Speaker #1: Drillmax: Shell Namibia, and then Energy in Greece, and Energy in Israel, and then an option in 2028. Stena Forth is currently working in Egypt, going to Namibia, and then we believe we have a contract—it's not signed, but we have agreed to a contract commencing in, yeah, maybe late 2026 or the beginning of 2027.
Speaker #2: Slide number 15, tankers and there you can see the performance in the market from the two categories that we are active in. Suezmax, 64,300 is the average day rate versus a 10-year average of 30,000, and then MRs, 31,200 versus a 10-year average of 20,600.
Speaker #1: And then running for two years. ICEMAX will also have various clients going forward, but looks to be fully occupied, with the exception of the special periodic survey in 2027.
Speaker #1: Stena Dawn is working for Adura, and that seems to be quite a long commitment. And then Stena Evolution is working for Shell for the foreseeable future.
Speaker #2: So incredibly strong market, and an incredibly strong result from tankers both operationally and also boosted by asset sales. And obviously, we depreciate our vessels pretty fast.
Speaker #1: So it looks like 2027 will be a year when we are fully employed—obviously, subject to utilization of various options—but we’re positive and hopeful that, and we really believe that, these will be utilized, and that we will see a good year in 2027 for drilling.
Speaker #2: That goes for the whole fleet of Stena, and that's also a reason why we can generate substantial net profits from asset sales, as well.
Speaker #2: Stena Rural, as I said in my initial remarks, a little bit of a dip in ongoing earnings due to the divestments that has been made.
Speaker #1: Slide number 15, tankers. And there you can see the performance in the market from the two categories that we are active in. Suezmax: $64,300 is the average day rate versus a 10-year average of $30,000.
Speaker #2: As I also said, there will be kind of compensated by new charter vessels coming in, although not before 2027. Then they've also placed an order for a new row of vessels, but that will be—there we don't have a client ready, and they will probably be chartered out in a little bit of a shorter term by Stena Rural.
Speaker #1: And then MRs, $31,200 versus a 10-year average of $20,600. So incredibly strong market, and an incredibly strong result from tankers, both operationally and also boosted by asset sales.
Speaker #1: And obviously, we depreciate our vessels pretty fast. That goes for the whole fleet of Stena, and that's also a reason why we can generate substantial net profits from asset sales as well.
Speaker #2: Moving on to slide number 17, Stena Property, and I think the—yeah, biggest reason why we saw an improvement in cash flow EBITDA is the acquisition of Shellfest, but this is a stable market, and very high occupancy rates in Sweden, 98%, and outside of Sweden, 95%.
Speaker #1: Stena Rural, as I said in my initial remarks, there is a little bit of a dip in ongoing earnings due to the divestments that have been made.
Speaker #2: The property value amounted to 60.5 billion by the end of Q2, and a loan-to-value of just shy of 44%. And there we are target—our internal target is to have 40%, and that will be—that will be reached in, yeah, within the next 12 to 18 months.
Speaker #1: As I also said, that will be kind of compensated by new charter vessels coming in, although not before 2027. Then they've also placed an order for a new RoRo vessel, but there we don't have a client ready, and they will probably be chartered out on a little bit of a shorter term by Stena RoRo.
Speaker #2: Final business area, Stena Dactum, and there, as you know, it's a mix of companies, and with the largest one being Ballingserv, which is a kitchen and bathroom manufacturer.
Speaker #1: Moving on to slide number 17. Stena Property, and I think the—yeah, the biggest reason why we saw an improvement in cash flow EBITDA is the acquisition of Shellfet. But this is a stable market, and we have very high occupancy rates: in Sweden, 98%, and outside of Sweden, 95%.
Speaker #2: Exposed, of course, to consumer sentiment, and yeah, I would say it's stable. We haven't seen the big rebound that we had hoped for yet, but we believe that is coming.
Speaker #2: From portfolio adjustments, Gunnebo Group, they divested a business unit. We own Gunnebo together with private equity companies Altur. And the transaction is subject to regulatory approvals, but it's—I would say it's quite a successful sale, which generates liquidity to Dactum and the group.
Speaker #1: The property value amounted to 60.5 billion by the end of Q2, and a loan-to-value of just shy of 44%. And there we are our target— our internal target is to have 40%, and that will be— that will be reached in, yeah, within the next 12 to 18 months.
Speaker #1: Final business area, Stena Dactum. There, as you know, it's a mix of companies, with the largest one being Ballingslöv, which is a kitchen and bathroom manufacturer.
Speaker #2: So with that, I think I will stop, and we already hear the Stena team to take your questions. Thank you very much.
Speaker #1: As a reminder, if you'd like to ask a question on today's call, and you've joined us via the phone, please press Star followed by 1 on your telephone keypad.
Speaker #1: If you're joining us online, the Q&A box can be found through the top right of the screen. And participants are asked to limit themselves to 2 questions per person.
Speaker #1: Exposed, of course, to consumer sentiment. And yeah, I would say it's stable. We haven't seen the big rebound that we had hoped for yet, but we believe that is coming.
Speaker #1: That's Star 1 or the Q&A box. We will begin with some text questions. We have 2 questions from Eric Wolf at JPMorgan. We'll read these one at a time.
Speaker #1: What drove the property revenue and EBITDA increase year-on-year and quarter-on-quarter? Were there any new acquisitions?
Speaker #1: Some portfolio adjustments: Gunnebo Group—they divested a business unit. We own Gunnebo together with private equity company Altor, and the transaction is subject to regulatory approvals. But I would say it's quite a successful sale, which generates liquidity to Dactum and the group.
Speaker #2: Yeah, I'll answer that then first, and basically that's what I said, that the acquisition of Shellfest is the most obvious reason. And then also, obviously, we've been able to have rent increases as well, and that also helps to boost the margins for property.
Speaker #1: So with that, I think I will stop, and we are ready here at the Stena team to take your questions. Thank you very much.
Speaker #1: Eric, second question reads, should we factor in any upcoming margin impact from the Stena Line pay increases that have been announced in the press, i.e., labour cost?
Speaker #2: As a reminder, if you'd like to ask a question on today's call and you’ve joined us via the phone, please press star followed by 1 on your telephone keypad.
Speaker #2: I haven't, to be honest, I haven't seen what Eric is referring to, but I would say that there is a program of cost cutting, and savings being launched, so I don't think that in isolation would mean any margin erosion.
Speaker #2: If you're joining us online, the Q&A box can be found at the top right of your screen. Participants are asked to limit themselves to two questions per person.
Speaker #2: That's star 1, or the Q&A box. We will begin with some text questions. We have two questions from Eric Wolf at JPMorgan. We'll read these one at a time.
Speaker #2: What drove the property revenue and EBITDA increase year-on-year and quarter-on-quarter? Were there any new acquisitions?
Speaker #3: Yeah, I'll answer
Speaker #1: What we would from Fidelity has 2 questions. I understand you have sold 3 tanker vessels year to date. Is this an active strategy to reduce the fleet size, or are sales more opportunistic?
Speaker #1: That's then first, and basically that's what I said, that the acquisition of Shellfet is the most obvious reason. And then also, obviously, we've been able to have rent increases as well, and that also helps to boost the margins for property.
Speaker #2: Yeah, I mean, I would say like this, that is the—it is more opportunistic. So we are taking the opportunity in a red-hot market to cash in a little bit and also, I mean, we would like to remain in the business, so I think maybe we are down to a number that which cannot be reduced from this level, but it was good to use the opportunity to get an opportunistic net profit.
Speaker #2: Eric, second question reads: Should we factor in any upcoming margin impact from the Stena Line pay increases that have been announced in the press, i.e., labor cost?
Speaker #1: I haven't. To be honest, I haven't seen what Eric is referring to, but I would say that there is a program of cost-cutting and savings being launched.
Speaker #1: How much of the EBITDA increase in ferries related to Wasserline? Were the measures introduced such that you were able to offset the impact of lower passenger volumes?
Speaker #1: So I don't think that, in isolation, will mean any margin erosion.
Speaker #2: I don't think we've disclosed that, but it's no—I mean, no secret. Maybe a third was related to Wasserline.
Speaker #2: Orwood from Fidelity has two questions. I understand you have sold three tanker vessels year to date. Is this an active strategy to reduce the fleet size, or are sales more opportunistic?
Speaker #1: Yeah, I mean, I would say it like this: it is more opportunistic. So we are taking the opportunity in a red-hot market to cash in a little bit, and also, I mean, we would like to remain in the business.
Speaker #1: Shubham Agrawal from BlackRock asks, what does the potential plan on the cap structure side? Do you plan to come to capital markets?
Speaker #2: Well, I mean, we—our plan is, as usual, that we should have a healthy liquidity, and that we should have kind of no near-term maturities.
Speaker #2: And as I explained during my initial comments, I think we are there on both of those targets. Will we go to the market? I mean, basically that depends on the price, and I think currently we find many more cost-efficient for us solutions in our funding, and so I think we are not planning on going to the market in the near term.
Speaker #1: So, I think maybe we are down to a number that cannot be reduced from this level. But it was good to use the opportunity to get an opportunistic net profit.
Speaker #2: How much of the EBITDA increase in Ferries was related to Wasserline? Were the measures introduced such that you were able to offset the impact of lower passenger volumes?
Speaker #1: I don't think we've disclosed that, but it's no—I mean, no secret. Maybe a third was related to Wasserline.
Speaker #2: As always, we don't rule it out either.
Speaker #1: As a reminder, that's Star 1 or the Q&A box. And our next question comes from Jonas Shum from Clarkson Securities. Jonas, your line is open.
Speaker #2: An aggregate from BlackRock asks, what was the potential plan on the cap structure side? Do you plan to come to capital markets?
Speaker #1: Please go ahead.
Speaker #3: Hey, Peter, thank you for hosting the presentation. So I have a question on the rig side. So you mentioned you will do the upgrade on Stena Evolution Q4, and it seems like it will be out of kind of commercial operations over a period of 4 to 5 months.
Speaker #1: Well, I mean, our plan is, as usual, that we should have healthy liquidity and that we should have no near-term maturities.
Speaker #1: And as I explained, we are there on both of those targets. Will we go to the market? I mean, basically that depends on the price, and I think currently we find many more cost-efficient solutions for us in our funding.
Speaker #3: So I was just wondering, how should we think about the unit earnings during that period?
Speaker #2: Yeah, hi Jonas. Jonathan here. So during that period, the vessel will not earn revenue, but the cost will be covered. So OPEX will be covered, but you will lose the revenue side of it, during those.
Speaker #1: And so I think, you know, we are not planning on going to the market in the near term. As always, we don't rule it out either.
Speaker #3: Okay. So I'll break even then. And then on your financing side, so you mentioned that you had this options for the revolving credit facility that matures that you can kind of roll it over a year at a time.
Speaker #2: As a reminder, that's star 1 or the Q&A box. And our next question comes from Jonas Schoem from Clarkson Securities. Jonas, your line is open.
Speaker #2: Please go ahead.
Speaker #3: And that it has now kind of matured in 2030. And you were mentioning that you could potentially roll it into 2032, but in 2031 you have 12.2 billion of bonds outstanding that comes to maturity.
Speaker #3: Hey Peter, thank you for hosting the presentation. I have a question on the rig side. You mentioned you will do the upgrade on Stena Evolution this fall.
Speaker #3: And it seems like it will be out of commercial operations over a period of four to five months. So I was just wondering, how should we think about the unit earnings during that period?
Speaker #3: I was just wondering, are there any contingencies in the revolving credit facility that necessitate kind of makes it necessary to address that bond maturity if you're going to get that revolver into 2032?
Speaker #1: Hi, Jonas. Jonathan here. So, during that period, the vessel will not earn revenue, but the cost will be covered. So OPEX will be covered, but you will lose the revenue side of it.
Speaker #2: I don't think so. I think our banks have full confidence that we manage our maturity, so we have, as I said, we have 2 options, and I expect that we will have a final maturity of 2032 for the revolving.
Speaker #1: During those periods.
Speaker #3: Okay, so I'll break even then. And then, on your financing side: you mentioned that you have this option for the revolving credit facility that matures, that you can kind of roll over a year at a time.
Speaker #3: Okay. Thank you very much.
Speaker #2: Thank you, Jonas.
Speaker #1: No further questions at this time. So as a reminder, that's Star 1 or the Q&A box provided. We have no further questions, so I'll hand it back to the management team for any closing comments.
Speaker #3: And that it has now kind of matured in 2030. You were mentioning that you could potentially roll it into 2032, but in 2031 you have $12.2 billion of bonds outstanding that come to maturity.
Speaker #2: Yeah, then I would just like to thank you for participating, and we'll see you next time at the end of November. So thank you very much.
Speaker #3: I was just wondering, are there any contingencies in the revolving credit facility that kind of make it necessary to address that bond maturity if you're going to get that revolver into 2032?
Speaker #2: Bye-bye.
Speaker #1: I don't think so. I think our banks have full confidence that we manage our maturity. As I said, we have two options, and I expect that we will have a final maturity of 2032 for the revolver.
Speaker #3: Okay. Thank you very much.
Speaker #1: Thank you, Jonas.
Speaker #2: Are there any further questions at this time? As a reminder, that's *star one* or you can use the Q&A box provided. We have no further questions, so I'll hand the call back to the management team for any closing comments.
Speaker #1: Yeah, then I would just like to thank you for participating, and we'll see you next time at the end of November. So, thank you very much.
Speaker #1: Bye-bye.