SFL (SFL) Q4 2024 earnings summary

Executive summary

• Reported Q4 2024 revenues exceeded $230 million, with net income of $20.2 million ($0.15 per share) and adjusted EBITDA of $132 million; 84th consecutive quarterly dividend of $0.27 per share declared, yielding approximately 10%.

• Over $2 billion in new fixed-rate charter backlog added in 2024, bringing total backlog to $4.3 billion, with two-thirds from investment-grade customers.

• Nine new vessels delivered in 2024, including large container, car carrier, and tanker vessels; multiple charter renewals and extensions completed.

• Awarded $48 million compensation from Seadrill in a Norwegian court related to the Hercules rig; ruling subject to appeal.

• Issued a new $150 million bond and agreed to sell older container vessels; gains recognized and expected.

Financial highlights

• Q4 2024 gross charter hire was $232 million; container fleet contributed $85 million, car carriers $26 million, tankers $42 million, dry bulk $23 million, and energy assets $55 million.

• Adjusted EBITDA for Q4 was $132 million; net profit was $20.2 million ($0.15 per share).

• Operating and G&A expenses were $104 million, up from $99 million in Q3 due to dry dockings and new vessel deliveries; operating expenses for Q4 2024 were $169.6 million.

• Profit share income from fuel savings and charters totaled $2.6 million in Q4; gain of $5.4 million booked from the sale of the Green Ace vessel.

• Cash and cash equivalents at quarter end were $135 million.

Outlook and guidance

• Over $2 billion in new fixed-rate charter backlog added in 2024, supporting future revenue visibility; majority contracted with investment-grade counterparties.

• Focus on owning and operating modern maritime assets with long-term charters to high-quality customers.

• Ongoing investments in LNG dual-fuel vessels and fuel efficiency upgrades to reduce carbon footprint.

• Expect lower stacking costs for the Hercules rig in 2025; rig is being upgraded and marketed for late 2025 and 2026 opportunities.

• No major impact anticipated from the global container ship order book on profitability through 2029-2030 due to long-term charters.