Earnings Call Transcript - CMBT Q4 2025

Operator, Operator

Good afternoon, and welcome to the CMB.TECH Earnings Conference Call for the Fourth Quarter of 2025. My name is Alexander Saverys, and I'm joined here by my colleagues, Joris, Enya and Ludovic. We will touch upon our classic topics. We'll start with our financial highlights. We will then give you a market update and finish with a conclusion and a Q&A. And for the financial highlights, I'd like to hand it over to Ludovic.

Ludovic Saverys, CFO

Thanks, Alex, and good afternoon, everyone. As always, we begin with an overview of our company. Currently, we have around 40 ships with an estimated fair market value of approximately $10.7 billion, not including vessels we have already sold. Our market capitalization is $4.2 billion following a significant increase in our shares. We have $1.5 billion remaining in capital expenditures as of the end of January and operate a modern fleet with an average age of 5.9 years. Dry bulk constitutes about 60% of our total fair market value, while the other divisions contribute to the remaining value. Focusing on the highlights from Q4, we achieved a net profit of $90 million, which brings our total profit for the year to $140 million. The EBITDA for this quarter was $322 million, culminating in an annual EBITDA of $943 million. Our liquidity remains strong at $560 million, and our debt covenants stand at 31% for equity on total assets and 44% for our other loan agreements. We had an impressive Q4, allowing us to reduce our debt, reinstate dividends—details of which we will discuss shortly—and strengthen our balance sheet through various actions. Regarding the results, the reported $90 million profit includes some nonrecurring one-off expenses, mainly tied to the final integration of the merger with Golden Ocean. These encompassed IT and refinancing costs that we classified as one-offs. Additionally, there were approximately $15 million in one-off costs in SG&A related to tax reversals and integration fees from the merger. Our liquidity of $560 million is robust, especially backed by favorable market conditions and asset sales, which will enhance our balance sheet as we approach 2026. As a reminder, we financed the initial 49% acquisition of Golden Ocean through a bridge facility, which we successfully repaid in January. This repayment incurred some costs, but it will generate approximately $42 million in interest savings for 2026. We are pleased to report that this was managed with our own cash, plus some leveraging on other dry bulk vessels. Our contract backlog stands at $3.05 billion. In Q4, we added around $304 million, mainly from Capesize vessels and one CSOV. We are also pleased to announce an interim dividend of $0.16, amounting to roughly $45 million to be paid out in April. We believe our balanced sheet is sufficiently strengthened to increase the dividend from the previous $0.05 per share. This announcement does not yet include the dividend related to the sale of 6 VLCCs, which will come with gains realized in Q1 and Q2, with the Board to make future dividend decisions then. We had a very busy delivery schedule in Q4 with six newbuilds. More importantly, we have already secured over $420 million in capital gains for Q4 and into Q1 and Q2, which is a locked-in profit. While we booked $50 million in Q4, we have guaranteed an additional $370 million profit in the upcoming quarters, providing us ample opportunities moving forward. We maintain a significant spot exposure, especially in dry bulk. Looking toward 2026, we have about 53,000 shipping days, with 44,000 being spot days. Specifically in dry bulk, we expect a strong market in 2026 with 36,000 days, including 27,000 on Capesize and Newcastlemax vessels. An increase of $10,000 over our breakeven would result in a cash flow of $270 million. We like to compare our segments with the order book to fleet ratio. Our bottom segments show a relatively low order book compared to other shipping segments. We believe we are well positioned in the Capesize and Panamax markets as we approach 2026. Regarding our CapEx plans, as of the end of January, we have around $1.5 billion in remaining CapEx, with $216 million expected from our own cash. The next 12 months will see a substantial delivery schedule, with approximately $1.2 billion payable to the shipyards. All necessary financing is secured. With cash from sales of VLCCs and Capesize vessels accounted for, our entire CapEx is covered. This means that, over the next year, any cash flow generated will provide opportunities to increase dividends and further reduce our debt. Our projected free cash flow, estimated based on conservative market rates, could reach $700 million on top of regular debt repayments, providing us with the capacity to repay the Nordic bonds out of our cash flow, continue funding our CapEx, and accelerate our debt reduction. That concludes our financial highlights, and I will now turn it over to Alex for the market update.

Operator, Operator

Thank you, Ludovic. I want to provide an update on the various markets where CMB.TECH operates. Our overview sheet outlines all our markets, focusing on demand, supply, and balance. This slide remains largely unchanged since three months ago. We continue to have a positive outlook on dry bulk tankers and offshore markets, while remaining cautious about the container and chemical sectors. In the dry bulk segment, we anticipate solid ton-mile growth for iron ore and bauxite in 2026, which is encouraging. On the supply front, while the order book to fleet ratio has increased slightly, we still find it to be a manageable 12.4%. Fleet growth for Capesizes this year is projected at only 2.3%, and we expect trade growth to exceed that. Overall, the balance remains optimistic. In our dry bulk division at Bocimar, we currently have 87 spot vessels, with an additional 9 expected to be delivered, which will also operate in the spot market unless a charter has been secured. Following our recent charters, we now have 16 vessels on charter, along with 3 newbuildings set to come on charter later this year and in early 2027. The tanker market presents a more subdued supply-demand picture, with fleet growth outpacing demand growth on paper. However, sentiment plays a significant role in buoying the market, which I will elaborate on when discussing Euronav. Overall, sentiment and earnings are strong in the tanker sector. Our tanker fleet has been slightly reduced after selling 8 vessels, but we maintain 12 vessels on the spot market and have 3 newbuildings on the way. We also have 10 vessels time chartered and 2 newbuildings scheduled for charter, which I’ll detail during the Euronav discussion. I will address containers and chemicals later. Regarding offshore energy, particularly in offshore wind and oil and gas, we're experiencing a slight acceleration in capacity installation, which bodes well for our CTV and CSOV markets. On the supply side, we've seen a slowdown in orders for new vessels, with the order book to fleet ratio for CTV at 13%, which we consider manageable. The ratio for CSOVs is higher, but demand from the offshore oil and gas sectors remains strong. I would like to highlight some slides regarding Bocimar and dry bulk, starting with our activities in Q4 and Q1. We have 36 Newcastlemaxes in operation, with another 10 newbuildings to be delivered by early 2027. In Q4, we achieved nearly $35,000 in daily rates, while Q1 is slightly above $30,000. Our 37 Capes are currently earning around $30,000 in Q4 and $26,000 in Q1. These rates are strong, particularly for this time of year, marking a robust first quarter. We have sold the Golden Magnum and the Belgravia, which will yield a capital gain of $8 million in Q1. Our 30 Kamsarmaxes and Panamaxes achieved rates of $17,300 in Q4 and $13,200 in Q1 thus far. Indicators on the right suggest a favorable dry bulk demand outlook, although iron ore inventories in China are rising and coal imports are decreasing, which are slightly negative signals. Nevertheless, overall, we observe more positive than negative signs for dry bulk. This slide illustrates the order book to fleet ratio for Capesizes and indicates that vessel values could be maintained over the next couple of years. We present the recent delivery of vessels and current newbuilding prices compared to the previous dry bulk boom. As long as the order book levels remain stable, asset values should be supported without anticipating an oversupply. The fleet profile for Capes and Panamaxes reflects minimal scrapping activity. Many vessels are aging significantly, with nearly 150 Capes older than 20 years and close to 600 older than 15 years, with even more concerning numbers for Panamaxes. If the market were to correct and scrapping increased, it could help balance supply and demand. In Q4 and Q1, the primary themes for our Capes and Newcastlemaxes have been iron ore and bauxite. The graphs depict rainfall and the loading volumes of these commodities in the Atlantic, West Africa, and the Pacific. Our data shows West Africa’s bauxite and iron ore are essential to counteract the weaker loading seasons typically seen in the Pacific and Atlantic. This dynamic is beneficial for our market, resulting in more opportunities for large bulkers to load cargo earlier in the year, reflected in positive rate reactions to these volumes. The fundamentals for the Capesize market this year are encouraging. We project a 2.7% increase in demand ton-miles versus a fleet growth of 2.3%. Therefore, we expect utilization to rise from its current level of around 90% to potentially 91% or 92% in the coming months. We note significant market movements in dry bulk, particularly for iron ore, with increasing volumes from regions like West Africa, Brazil, and Australia. Seaborne iron ore is expected to grow from locations far from its primary market in China, which is favorable for ton-mile demand. We've seen surprising bauxite volumes in January, suggesting the total could exceed 184 million tons if this trend persists, which supports both commodities in terms of volume and ton-mile for 2026. Now turning to Euronav and the crude oil tanker market, our VLCC fleet has decreased after the sale of 8 older vessels, leaving us with 3 VLCCs on the water, including one built in 2016 and 2 newbuildings, with 3 eco VLCCs expected shortly, totaling 6 vessels. We achieved rates around $75,000 for both Q4 and Q1 to date. Our Suezmax fleet consists of 17 vessels, with 2 more delivering soon, already placed on long-term time charters. The spot fleet is currently yielding around $60,000 to $65,000 for both quarters, with rising market support. The indicators are positive; even though the tanker fleet is growing, we have a strong market sentiment and fundamentals supporting this environment. The sustainability of the expanding crude tanker order book will hinge on the duration and potential increase in scrapping activity. We note an uptick in VLCC and Suezmax orders; however, these won't impact the market until 2028. Future market dynamics will be closely related to the balance of scrapping vs. newbuilds to avoid market disruption. Demand for crude tankers remains varied across different agencies. Current production exceeds consumption, suggesting significant stockpiling, especially by China, which significantly supports tanker markets. The next six months, particularly concerning oil prices and geopolitical factors, may alter these scenarios. Presently, we observe an oversupplied oil market, which is being absorbed through stockpiling. The ongoing sanctions, particularly related to the Russia-Ukraine situation and developments in Iran and Venezuela, are critical. One notable trend is the reduction of Indian crude imports from Russia following U.S. sanctions, with China likely compensating for the decrease. Regarding our container vessels at Delphis, all four are under long-term charter agreements for 10 years, with an additional newbuilding scheduled for delivery this year, which will also be on a 15-year time charter. As such, our exposure to the spot market is minimal. The spot freight market is declining, with the SCFI trending downward, indicating reduced rates. Interestingly, the charter market remains resilient due to limited availability of charter vessels, as major lines continue to compete for market share. We anticipate continued declines because of a substantial order book slated for delivery in 2027 and 2028. In our chemical tanker division, Bochem, we operate 8 vessels with a mix of time charters and 2 vessels in a spot pool. We also have an order book of 8 vessels, including 2 product tankers this year and 6 chemical tankers in 2028 and 2029, all under long-term charters. Our spot exposure remains limited, and while we observe a slight decline in the spot market, the situation isn’t dramatic. Rates are softer than in 2024, although still relatively acceptable. In conclusion, I want to highlight Windcat, which has performed exceptionally well recently. We delivered 2 CSOVs last year, with one earning impressive spot rates of $108,000 a day in Q4, and another fixed on a long-term contract for North Sea work. We look forward to the delivery of 4 additional CSOVs and one larger CSOV XL in the coming years, as the positive demand for modern offshore supply vessels continues. Increased demand from the oil and gas market has made these vessels more lucrative than originally earmarked for wind projects. The wind market is also showing encouraging trends, with new projects expected in the North Sea and Europe, which will drive demand for our CTVs and CSOVs. With a fleet of nearly 60 CTVs, we are pleased with the rates we are achieving and anticipate an even better performance in 2026 compared to 2025. That concludes our market update. I will now hand it over to Enya for the Q&A session.

Operator, Operator

We will now start taking the first question. Frode Morkedal, you can unmute and ask your question.

Frode Morkedal, Analyst

Yes. Can you hear me?

Operator, Operator

Yes. Perfect.

Frode Morkedal, Analyst

On the topic of the Golden Ocean bridge repayment, can we assume that the strong tanker market contributed to this? Specifically, it seems that the sale of the 8 VLCCs played a significant role in enabling you to repay ahead of schedule. Additionally, could you remind us of the figures involved, such as the size of the bridge facility and the net proceeds from the sale of these 8 plus 2 Capes?

Ludovic Saverys, CFO

Sure, I'll take that one. To remind you, we had a $1.4 billion acquisition facility from the banks, but we only drew $1.3 billion. This was the total amount we fully utilized to purchase the first 40% and then an additional 9% of the market. Following the merger in August, we quickly re-leveraged the Golden Ocean ships with a $2 billion facility. We utilized $750 million from this refinancing to reduce our exposure to $550 million. We maintained that $550 million from around September until two weeks ago, and we've since paid it down using operational cash flow and proceeds from vessel sales, including some vessels sold in Q4 from Q3. Moreover, we managed to transfer approximately $270 million from the costly $2 billion facility with Golden Ocean, alongside some Chinese leasing finalized last December. Overall, cash on hand was around $260 million to $270 million. The sale of the tankers, particularly the six plus two Capes, has significantly reinforced the Board's confidence in providing more dividends, further reducing debt, and satisfying concerns regarding the Nordic bonds for the remainder of the year, leveraging the $420 million generated from the eight tankers. This opens up great opportunities for us in all the areas we discussed.

Frode Morkedal, Analyst

Is the goal still to reduce the net LTV to around 50%? At that point, you could...

Ludovic Saverys, CFO

At that point, Frode, I think the long-term target is at 50% LTV. The LTV at the end of December was roughly 55%. With the increase in tanker values, as everybody has seen in the market, we are probably already at those levels. But that is the target. I think it's more important to discuss the opportunities with every dollar that comes in from sales of operational cash. This could be in the form of dividends, further deleveraging, or accelerating payments on some of our revolvers to reduce interest costs. When it comes to mergers and acquisitions, there are costs involved, especially with leveraged buyouts. We noticed that in 2025, the SG&A was higher due to lawyer fees, success fees, and refinancing. Hopefully, going forward, our interest costs in 2025 should decrease significantly because we will no longer have bridge loans; we are replacing expensive bank debt with more affordable options like Chinese leasing and other cheaper instruments.

Frode Morkedal, Analyst

Right. So is it fair to assume that you would probably wait for the bond maturity or some type of refinancing before you step up the dividend payments, even if you are probably approaching 50% earlier than this, right?

Ludovic Saverys, CFO

I think the decision of the Board of the $0.16 that we paid today is testimony that I think we can do both paying dividends, both delevering, and both continuing to delivering all the newbuilds.

Frode Morkedal, Analyst

Great. Final question is on NAV. What do you see about investment opportunities, specifically newbuilds, I guess. For example, in tankers, I mean, I'm hearing it's starting to get tempting to start ordering VLCCs, right, because you can order at $120-something million and the prompt resale is $40 million to $50 million higher. So that type of, let's say, arm is opening up and maybe that is interesting. What's your view?

Operator, Operator

Our view is that the ship you ordered today at $120 million, delivers in 2029. So today, it might look cheap. In 2029, it might look very expensive. Right now, Frode, we are not actively pursuing tanker newbuilding plans. We are, of course, opportunistic. We will look at any possibility that comes across. But right now, we'd rather enjoy the spot market and not order any tankers.

Operator, Operator

The next one is Petter Haugen. You may now unmute and ask your question, please.

Petter Haugen, Analyst

Considering the situation, do you have any plans to sell some of your Suezmax tankers to help pay down debt and distribute dividends?

Operator, Operator

Yes, Petter. Look, the first thing we wanted to do over the last 1.5 years is to sell our older vessels. I think we've done a good job at that so far. So obviously, we still maybe have 1 or 2 older vessels that could be up for sale. The second thing is if we see an exceptionally high price for any asset, we will always look at it. Look, trading ships, buying and selling ships is part of our business. And where we like to keep our younger vessels, we will never say no to a very high price. Do we need it to deliver? No. That I would say, I think the heavy lifting on delevering has been done. I think operational cash flows can bring us to a very comfortable leverage over the next 9 months. But we will always be ship traders. If someone comes with a very high price on any assets, we will look at it.

Petter Haugen, Analyst

Understood. Regarding your dry bulk fleet, I have a similar question. We've observed how the market has responded positively to your sales and the announced increase in dividends. For the Capesize fleet, it seems there are still opportunities to sell older ships. Is that process complete now, or is it still a possibility? I understand you sell at the right price, which applies to all of us. However, considering the strong tanker market and the increasingly robust dry bulk markets, I would assume you are considering selling more rather than the contrary.

Operator, Operator

No, I think that is not really correct. I think on the dry bulk side, we believe we are not yet where the tanker market is right now. We think this market has a lot more in it, and we would like to let it run. So stay spot exposed unless we find some good charter parties. And as you've seen, we fixed 5 of our Capes for 5 years at what we believe are very good rates or unless, again, an exceptional price comes along. But I don't think we're there yet. So we're very happy with the dry bulk fleet we have now. We have sold some of our older vessels. And now we really want to just enjoy the market for the next couple of quarters.

Operator, Operator

Now, Kristof Samoy, you can now unmute and ask your question, please.

Kristof Samoy, Analyst

I have 2. One on long-term charters. You've concluded these 5-year charters for your Capesizes. Could you disclose the counterparty? And then secondly, we've also seen in the market that Vale has been ordering quite some newbuild VLOCs. Would your Newcastlemaxes have been competitive for the trade? Or were they particularly looking for 400,000 deadweight ton plus vessels for the transportation? That's the first bulk of my question. And then secondly, on the U.S. Maritime Action Plan proposal. I recall when we discussed USTR and the impact or the potential impact of USTR in previous calls that you indicated that the impact would be fairly limited because you have little port calls in the U.S. Does this logic still apply to the now proposed U.S. Maritime Action Plan? Or are there like substantial differences there that you see for CMB?

Operator, Operator

Okay. Thanks, Kristof. So first, the counterpart of the charters, that's confidential. So we are not disclosing that, but it's a very good counterpart. On Vale and their large ore Valemaxes, typically, what they like is to do very, very long-term deal at very, very low returns. That's not something we like. Could our Newcastlemaxes have completed, of course, but then we would have accepted a very, very low return. That's usually these large projects, and we leave that to some of the specialists in Asia. And our relationship with Vale on the spot market is still there. We do business with them with our Newcastlemaxes. On what is happening in the U.S., Kristof, you will agree with me that the only thing we know is that we don't know. Things are changing by the day. When you say that we don't have a lot of port calls in the U.S., that's actually not true on the tanker side. Don't forget, we do quite a lot of business with our tankers in the United States. But under the USTR and all the other regulations, we would have been exempt anyway because energy was going to be exempt. The new package that is there, it's too early to assess what the impact would be on our business.

Operator, Operator

Climent Molins, you can now unmute and ask your question, please.

Climent Molins, Analyst

I wanted to follow up on Kristof's question on the Capesize charters. Could you disclose the rate on the contracts? Or is it confidential as well? And secondly, what's your current stance on potentially adding more coverage based on your forward outlook on the dry bulk side?

Operator, Operator

Yes. Thank you, Climent. So no, again, we can't disclose the rate. But I think if you look into broker reports, how they quote a 5-year Cape rate, and add a little bit to that because our vessels are more modern and better than what brokers are quoting, then you're probably in the ballpark. But so unfortunately, we cannot disclose the rate. Would we look at taking more coverage? Yes, the answer is yes. We have said this in this call many times. We think that, ultimately, we want to create stable cash flows in our company. We will not do it at any price. But when markets move in the kind of zones we are now, we will actively engage with our customers to see whether we can take more long-term cover.

Climent Molins, Analyst

Makes sense. And I also wanted to ask about the dividends on the gains on sales. I assumed a few minutes late, and you may have already touched upon this, but is it fair to assume you'll declare a dividend on that front on both Q1 and Q2 based on the reported gains?

Operator, Operator

The answer is definitely on Q1. And again, if you take back full discretionary dividend policy, I think every quarter, we look at it. We had a very good Q4 quarter. We were able to achieve a lot of the internal check the boxes to reinstate, I would say, a somewhat higher dividend than before. So the $0.16 was purely on Q4. Q1, we have already $270 million profit, which we announced our intention to pay a dividend on it. So that will be decided and confirmed, I would say, on that part in the May earnings release for Q1. And as the market continues, as we continue probably to shift from sales to really operational cash flow and take out the remaining parts of the new build program and the bonds, it frees up a lot more capacity for dividends. But again, we're not going to commit to a fixed percentage. I think it will be quarter-by-quarter that we look at, but it's fair to say that it all looks pretty good.

Operator, Operator

We have 2 more questions in the Q&A. So the first one is, do you expect Sinokor's behavior to trigger a regulatory reaction?

Operator, Operator

I don't know. You should ask Sinokor.

Operator, Operator

And then the second one is, what are your expectations on framework changes after the European Industry Summit?

Operator, Operator

I think the theme of that summit was more the industry based on land and not specifically on the maritime side. But I do think it's great that our politicians are aware that if we want to make sure that prosperity continues in Europe, we need to change certain things. And that can only help our vibrant maritime industry, which, as you know, is very strong here in Europe.

Operator, Operator

We have one more question live. Victor, you may now unmute and ask your question.

Unknown Analyst, Analyst

I had a quick question regarding your leverage. Do you intend to lower it back to pre-2025? Or do you have a figure in mind on the leverage you're looking for? Also on the equity ratio, you haven't moved a lot on this part. And just wondering how far you are within your covenants? And last question, can you give us more flavor on the recent cooperation you signed with China for your new project there?

Ludovic Saverys, CFO

Yes, thanks for the questions. On the leverage, we have a target of 50% loan-to-value, and I think we're close to that. If you consider today's value, especially with the increase in tankers, we're pretty much there. It’s also important to ensure that this is combined with the long-term cash flows we have and the opportunities ahead. We did increase our leverage significantly with the Golden Ocean opportunity, but as shareholders, we're pleased with that decision. That leverage has decreased, and we’re positioned with another 90 dry bulk ships in a strong market, making the increase in leverage justified from a tactical perspective. Just to remind you, we have a low book value due to our strategy of acquiring or ordering assets at a good price and not re-evaluating our assets in terms of book value. If you look at the value-adjusted equity shown in our overview slide, you’ll see that the equity ratio has increased substantially with the fair market value adjustment. The bond covenant of 31% in Q4 confirms that if we add another $370 million in profits from fixed sales in Q1 and Q2, that covenant will comfortably remain in effect until the bonds mature in September. We probably won’t be issuing a new bond to pay it back at maturity. Overall, we are solid on all covenants, and you'll see that reflected in the audited financials at the end of March.

Operator, Operator

And then Victor, to answer your question on our investments and our joint venture in China. You know that we are building ammonia-powered vessels that will deliver this year. We have secured an offtake of green ammonia in China. And we have also invested in a company that provides the logistics for that ammonia, bringing the ammonia from the factory where it is produced to the tank and from the tank with a bunker barge to our ship. So that is the nature of our investment there.

Ludovic Saverys, CFO

And for everybody, we mentioned this, this is quite a small investment. We took a stake to better understand, to better control that logistics and to see how that is developing. But we were talking a couple of tens of millions, but definitely not a huge investment.

Unknown Analyst, Analyst

And last question, if you allow me this. Do you have a target on the EU ETS price?

Operator, Operator

That I want to pay or that I want the market to go to.

Unknown Analyst, Analyst

That you want the market to go to for your investments to be more interesting for our customers.

Operator, Operator

It's a very good question, Victor. Of course, the higher, the better because then there will be more incentive for people to use our assets in European waters. Okay. Thank you, Victor.

Operator, Operator

Okay. Then Quirijn wants to ask a question. You can now unmute.

Quirijn Mulder, Analyst

You sound quite optimistic about the wind offshore market. Can you maybe give some idea about the utilization and, let me say, the future prospects? Let me say, is it more what you see from your order book? Or is it more what you see in the market happening? Maybe you can elaborate a little bit on that.

Operator, Operator

Yes. So I think the optimism comes from 2 sides. The first side is purely related to the wind and the new parks that will be developed in the next 3 to 4 years. As you know, a lot of projects over the last 2, 3 years have been either halted or delayed. What we do see is that certain projects are still coming through in the North Sea, which will create additional demand for offshore wind supply vessels. But we're also optimistic, Quirijn, because our assets that we are deploying for wind parks can also be deployed in offshore oil and gas markets. There, the fleet has been aging, has not been renewed sufficiently. The quality and the comfort of the assets in the oil and gas markets is much less than the ones in the wind markets. So our assets that are suited for wind are actually in very high demand to serve the oil and gas markets. And what we're trying to do over the last 6 to 9 months is basically to make sure that our ships can earn good money in oil and gas. And then once they have done their job, their transition to better wind markets.

Quirijn Mulder, Analyst

The contract size in wind energy is quite different from that in oil and gas. Wind contracts generally tend to be longer and require more time, while oil and gas contracts are typically shorter in duration.

Operator, Operator

That's not really true. You see long-term contracts in oil and gas and you see spot contracts in wind. Our CSOVs have been ordered to operate on the spot market first. And as and when we see longer-term contracts, then we go for it. What we have not done, unlike some of our competitors is order these vessels with a charter attached because there the charters were very, very low paying.

Ludovic Saverys, CFO

It's a little bit similar to the analogy with the Vale contracts that, yes, there are certain peers that accept not the IRRs we would accept. And hence, with the balance sheet that we have, the strength we have, the knowledge in the market, we order speculatively spot based on long-term fundamentals and then wait a little bit until, as Alex mentioned, we see good long-term contracts as we've done on the second CSOV, which is actually quite profitable contracts over 3 years.

Operator, Operator

I think this concludes the questions.

Operator, Operator

Okay. So I'd like to thank everyone for dialing in today. Thank you for your questions. Thank you for your attention. You know that if you have any other questions, we are here to answer them. Do reach out to us if you have any further questions. And I look forward to speaking to you on our next call. Thank you very much. Bye-bye.