Good day and thank you for standing by. Welcome to the Second Quarter 2022 SFL Corporation Earnings Conference Call. [Operator Instructions] Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Ole Hjertaker. Please go ahead.

Thank you and welcome everyone to our second quarter conference call. I will start the call by briefly going through the highlights of the quarter. And following that, our CFO, Aksel Olesen, will take us through the financials. And then the call will be concluded with opening up for questions. Our Chief Operating Officer, Trym Sjølie, will also be present for the Q&A session. Before we begin our presentation, I would like to note that this conference call will contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as expects, anticipates, intends, estimates or similar expressions are intended to identify these forward-looking statements. Forward-looking statements are not guarantees of future performance. These statements are based on our current plans and expectations and are inherently subject to risks and uncertainties that could cause future activities and results of operations to be materially different from those set forth in the forward-looking statements. Important factors that could cause actual results to differ include, but are not limited to, conditions in the shipping, offshore and credit markets. You should therefore not place undue reliance on these forward-looking statements. Please refer to our filings with the Securities and Exchange Commission for more detailed discussions on the risks and uncertainties, which may have a direct bearing on our operating results and our financial condition. The total charter revenues in the quarter were $165 million with the vast majority for vessels on long-term charters and only 17% from vessels employed on short-term charters or in the spot market. The EBITDA equivalent cash flow in the quarter was approximately $124 million. And over the last 12 months, the EBITDA equivalent has been approximately $476 million. The net income came in at around $57 million in the quarter or $0.45…

Thank you, Mr. Hjertaker. On this slide, we have shown our pro forma illustration of cash flows for the second quarter. Please note that this is only a guideline to assess the company’s performance and is not in accordance with U.S. GAAP and also net of extraordinary and non-cash items. In the second quarter, the liner fleet generated gross charter hire of approximately $89 million, including approximately $3.8 million in profit share contribution related to fuel savings on some of our large container vessels. At the end of the second quarter, SFL’s liner fleet backlog was approximately $2.4 billion, with an average remaining charter term of approximately 4.9 or 7.5 years if weighted by charter hire. In the second quarter, SFL has a fleet of 16 crude oil products and chemical tankers with majority employed on long-term charters. The tanker fleet generated approximately $35 million in gross charter during the quarter compared to $30 million in the previous quarter as several Trafigura vessels at the first full quarter of revenue, as well as two Suezmax tankers and two smaller chemical tankers trading in the spot and short-term charter market. The net charter hire from these vessels was approximately $6.6 million in the second quarter compared to approximately $3.5 million in the first quarter. Furthermore, the company expects the recent announced Suezmax tankers on charter to cost to have full cash flow effect from early in the fourth quarter with an estimated EBITDA contribution of $7.5 million per quarter. The company had 6 dry bulk carriers, of which 10 were employed on long-term charters during the quarter. SFL generated approximately $31 million in gross charter hire from the dry bulk fleet in the second quarter, including $1.4 million of profit share. 5 vessels were employed in the spot and short-term market…

[Operator Instructions] And the first question comes from the line of Liam Burke from B. Riley Financial. Your line is open. Please ask your question.

Yes. Thank you. Asset values of certain vessel classes are exceedingly high. You mentioned low order books in some sectors. Are there any particular assets that you see would be attractive sales to raise additional cash?

Well, we – as we say here, everything is for sale at the right price. Of course, our main focus is long-term charters, and of course, to service those long-term charters unique to keep those assets. We do have some assets with shorter charters and also some assets that are currently trading in the spot market. We, for instance, have 5 Supramax bulkers that have been on long-term charter and has come back from those. The last one was delivered earlier this year. We have two chemical carriers that also came off a charter earlier this year. So, we have some assets from time-to-time. But of course, it’s all about timing and getting sort of the right bang for the box. So, we evaluate that all the time. And just sort of just when I joined SFL, it’s 16 years ago now, we had around 50 vessels. In the meantime – and right now, we have 75. But in the meantime, we have purchased 125 vessels and sold 100 vessels. So, I would say this is sort of a natural part of the business. And of course, our focus is to reinvest in newer, more modern vessels, and this is going to continue, I would say, gradual over the next period.

Yes. I am also adding to that. We have a very strong liquidity position currently and also released some additional cash through refinancing of our assets. So, I think we were in position to grow.

Fair enough. When you are looking at – on the acquisition side, you mentioned that the tanker cycle is looking very attractive there. Would that be more where you would want to invest in the larger VLCCs or Suezmaxes vis-à-vis where the purchase of a container vessel might – where they are in the cycle be less attractive?

Well, you can say – academically, we would invest in any sector. It’s all about how you structure the transaction, how you manage risk. So, you could say we would still look at container ships, but it’s got to be with very strong counterparties and structured so we can effectively amortize it over the charter period to more of a mid-cycle depreciated value. So, that all goes into that equation before we decide on how we are going to go forward with an acquisition or not. So, we look at all segments at any one time. And I think from our side, we believe that’s the strength having a diversified asset approach or market approach because what we have seen over time is that companies that are in one segment only are almost programmed to go bankrupt almost. Because what we see is that, typically, when the capital markets are open and when the banks are eager to lend money, that’s typically at the top of the market. So, while – when you are lowering the cycle in a segment, there is no way you can raise equity and banks are reluctant. So, it’s so tempting to take the money at the top of the market and reinvest in the wrong assets. So, what we do instead, we look at all these segments at the same time, and therefore, try to – if we think that things are running a little bit too fast in one segment, we switch your attention to other segments. But still, even if we are high in the cycle, then we will try to be very, very focused on risk mitigation factors before we decide to invest despite, call it, the normal cycle movements than the others – than if we believe you are lower in the cycle. But back to your point, we think tanker market looks interesting. We wouldn’t mind do more on the tanker side. But it has to be in combination with the right asset, with the right counterparty, with the right charter rate structure where we can, again, depreciate it down to the right level. So, we look at that all the time.

Great. Thank you very much.

Thanks Liam.

Thank you. Dear speakers, there are no further questions. And I would like to hand over back to Ole Hjertaker for closing remarks.

Yes. Then I would like to thank everyone for participating in this conference call, and also thank the SFL teams onboard, the vessels and onshore for their continued efforts in delivering value for our stakeholders. If you do have any follow-up questions, there are contact details in the press release or you can get in touch with us through the contact pages on our webpage, www.sflcorp.com. Thank you.

That does conclude our conference for today. Thank you for participating. You may all disconnect. Have a nice day.