Good morning and welcome to the presentation of Acastor's second quarter results. My name is Øyvind Poske, CFO, and I'm joined today by our CEO, Carl-Erik Kjelstad. As in the previous quarter, our presentation now includes less detailed coverage of HMH, as that now is a listed company reporting independently. Their Q2 webcast replay and transcript are available on their website. We will take questions at the end of the session, and you may submit them at any time through the online Q&A function. To start, Kalle will take you through the key developments of the quarter. Kalle, over to you.
Thank you, Eivind, and good morning, and thank you all for joining us this morning. I will start with the key highlights as mentioned for Eivind, and before briefly taking you through over the portfolio and also over ownership agenda. Let's move to slide 2. The second quarter marks another important step in Acosto's transition from value creation to value realization and shareholder distribution. We are pleased to announce that the board has approved a cash dividend of NUC 0.50 per share, supported by proceeds from the sale of Scandi Emerald. In fact, this represents a fifth consecutive quarterly distribution to shareholders. The HMH IPO was completed in April, reducing Acosta ownership to 36% and contributing significant cash proceeds to Acosta during the quarter. HMH also delivered a solid operational and financial performance with adjusted EBITDA of US$34 million, corresponding to a 20% margin and a strong order intake representing a book the bill ratio of 1.2 supporting management's increased activity and expectations for the second half of 2026. ARCOV's offshore continued to deliver stable operations across the fleet, supported by strong utilization and operational performance. For Ness Faircroft, an important milestone was reached after quarter end, with the successful placement of the new US$650 million senior secured bond. The transaction supports refinancing and a planned shareholder recapitalization of up to US dollars 350 million. Anacosto expects to receive its share of cash proceeds available to shareholders through that recapitalization but subject to remaining conditions and approvals. DDB offshore also continued its realisation process completing the mentioned sale of Scandi Emerald in June for US dollar 23 million. Finally, this is also the first quarter where we present a fair value adjusted NAV. The key change is HMH, which is now listed and can be valued based on the closing share price at the end of the quarter. All of the investments continue to be reflected at book value. As HMH represents around 60% of gross asset value, the listed share price provides a clear market reference for a significant part of the portfolio, making ENAV a more relevant measure going forward. Net asset value amounted to 4.7 billion at the end of June, and that corresponds to Nook 17.3 per share. Eivind will take you through more details later regarding this in the presentation. Let's move to slide 4, the portfolio overview. The portfolio is largely unchanged from the previous quarter, with HMH as a listed investment following the IPO completed in April. HMH remains of a largest investment, with a cost of holding an economic interest of 36.3%, a slight adjustment to the 36.2% used in the second quarter, based on the actual share count per June. Nils Faircroft remains an important financial investment and Arcoastor have continued to hold an estimated economic interest of around 15%. Arcoast Offshore remains at 66.7% on investment while DDU Offshore is now down to only one remaining vessel following the sale of Scandi Atlantic earlier this year and Scandi Emerald in June. In addition we continue to hold some smaller investments in Aqualis Furn Energy Service and EcoM Løfte Technik, which provide further optionality but represent a smaller share of our total values. Let's take a look at some of the portfolio companies starting out with HMH at slide 5. For the second quarter, HMH reported revenues of US$171 and an adjusted EBD of US$34 million, corresponding to 20% margin. The margin performance demonstrates a silence despite the dynamic market environment. Order intake was strong and the first half book to build ratio of 1.2 supports increased activity and expectations that we have for the second half of 2026. Following the IPO, HMH is now listed and provides a direct market reference for Acostos largest investment. From an Acostos perspective, HMH's listing is important for two reasons. First, it established a public market valuation for the investment and secondly, it improved liquidity and further optionality for our cost of ownership position. Our ownership remains forever unchanged. We will continue to support HMH strategy to drive profitable growth and value creation both organically and through selective M&A. We also want HMH to maintain its strong market position through technology leadership and and customer focus in innovation. At the same time, we will actively manage our ownership over time, with a clear focus on value realisation. We are not in a rush, and any further decision will be based on market conditions, liquidity and overview of the underlying values in HMH. Let's move to slide 6 and Nears Faircraft. During the quarter, Nears completed the acquisition of Halian, establishing a platform for division into technology services. This is an important strategic development and broadens the company exposure beyond its traditional engineering workforce business. Operationally, the company continued to deliver solid performance, and underlying EBITDA increased 7% year-on-year, while performing in the last 12 months EBITDA reached US$ 164, reflecting Halyan pre-acquisition performance and annualized synergies. Cash generation was also strong, driven by effective working capital management. Post quarter-end years, as mentioned, successfully placed a new US$650 million bond supporting refinancing and a planned shareholder recapitalization. While a substantial portion of the proceeds will be used to refinance existing debt, the bond terms also allow for dividend recapitalization of up to 350 million. Subject to as mentioned leverage and other conditions. This is an important step both for Eneas and for Acosto, giving a important long-term capital structure while creating the potential for cash proceeds to shareholders, shut back to remaining conditions and approvals. From an ownership perspective or agenda remains to support the growth in the Sphere growth by organic initiatives and also selective M&A, well, in order to optimize value at exit. The plan recapitalization process represents an important building block in this strategy. Slide 7. Arcov offshore. Arcov delivered a strong quarter with a revenue of US$44 and an EBITDA of US$16 million. Operational performance was solid across the fleet. Arco Wayfair delivered a revenue utilization of 98% in the quarter, supported by a stable operation following completion of the class renewal survey in the first quarter. Arco Seafair delivered a revenue utilization of 93% with a strong operational performance. Arco Santos delivered some lower revenue utilization this quarter with 86%, impacted by the temporary thruster motor failure in May, but it returned to near full utilization in you following the repair of this mentioned thruster. Commercially Arcovice is in a strong position, with good contract coverage and a long-term visibility across the fleet. The contract awards and renewals secured over the past year has strengthened the backlog and earnings predictability, providing a solid foundation for the ongoing refunding process and supporting further value creation. Our ownership agenda remains focused on securing delivery on the order backlog and exploring strategic initiatives over time. Slide 8 DdV Offshore DdV now owns only one remaining anchor handling vessel, Scandi and Peregrino, following the sale of Scandi Emerald in June. Scandi Pergrin remained on contract in Australia throughout the quarter and delivered a solid 98% utilization. During the quarter, the firm contract period was extended to November 2026 to an exercise option providing continued visibility and for the remaining vessel. The sale of Scandi Emerald was completed in June for the mentioned $23 million. The transaction generated a positive impact on revenue and EBITDA in the quarter and contributed to Acosta's strengthened liquidity position. The DDV transactions are fully aligned with our strategy of value realization. We have reduced exposure to maturing investment, realized cash proceeds, and created a basis for further shareholder distributions. Going forward, the focus for DDV is to safeguard operations, secure high utilization for Scandi Peregrino and optimize value at exit. Then, finally, let's look at slide 9 with the key priorities for Acosto going forward. Acosto's strategy remains focused on value creation, enabling liquidity and returning capital to shareholders. We continue to work actively with our portfolio companies to maximize value through strategic, operational and financial initiatives. That remains the foundation for our ownership model. At the same time, we are increasingly moving from value creation into value realization. The HMH IPO, the DDV vessel sales and refinancing and recapitalization of Ness Wirecroft are all examples of this. Our objective is to create portfolio liquidity and optimize the timing of exits either through cash realization or listed shares. When proceeds are realized we will continue to assess distribution to shareholders while at the same time maintaining a sound capital structure. The fifth consecutive dividend approved in connection in the second quarter is a clear example of this strategy put into action. With that I will hand over to Öyvind who will take you through the financial update in more detail. Øyvind over to you.
Thank you Kalle and I will then take you through our financials starting on slide 11 with our balance sheet and the fair value adjustments. As Kalle mentioned following in the listing of HMH we are shifting focus from book values towards fair value adjusted net asset value. The key reason is of course that HMH is now listed which gives us a clear market reference for this investment, which represents around 60% of our gross asset values. As shown in the table to the left on this slide, the only fair value adjustment is related to HMH, while all the other investments continue to be reflected at book value. Starting with HMH, the carrying value in our books was NOC 3.01 billion at quarter end, end, reflecting then Acastor's 36.3% post-IPO ownership share under the equity method. The fair value adjusted value was NOC 2.966 billion, based on the closing share price of US$ 18.74 per share at the end of June. This gave a negative fair value adjustment of NOC 44 million. Since quarter end, the share price of HMH has increased, implying a higher fair value of Acastor's HMH investment today than reflected in the net asset value as per Q2. The book value of HMH decreased by NOC 433 million during the quarter, mainly reflecting the reduced ownership following the IPO, as well as IPO-related accounting effects recognized during the period. Going forward, HMH book value will reflect a cost of share of HMH reported equity under the equity method, while the net asset value view will separately reflect the market value of our listed holding. For DdV book values decreased during the period following the realization of Scandi Emerald. The sale was completed for 23 million, as mentioned, with value then effectively transferred into cash. ACOV's offshore remains carried at zero in our books, reflecting the prior reduction of the equity investment. We do, however, continue to carry the shareholder receivable provided to ACOV at full value, included here under shareholder receivables. Other assets and other liabilities remained relatively stable through the period. Shareholder receivables were reduced following the cash settlements of the HMH shareholder loan in connection with IPO, while cash and fund investments increased to NOC 560 million at quarter end. Debt was reduced during the quarter following the DDV realization. In total, book equity value decreased by 472 million during the quarter, primarily reflecting the dividend payment of NOC 1.5 per share paid in May and the accounting effects recognized in the period. At the same time, value realizations in HMH and DDV transferred value into cash, strengthening the balance sheet liquidity position. Our total fair value adjusted NAV was NOC 4.735 billion at the end of June, corresponding to NOC 17.3 per share, which was then broadly in line with the book equity value per share as per June 30th. Let's then turn to the next slide for the overview of cash movements. In Q2, our net cash position increased by $321 million to $540 million at period end. This was then driven by proceeds from the HMH IPO as well as the sale of Scandi Emerald, partly offset by the dividend payment in May. The Q2 consolidated net cash position includes a net cash position of NOC 24 million in DDV offshore, compared to a net debt position of 68 million in DDV in the previous quarter. This reflects the completion of the Scandi-Emerald transaction, where part of the proceeds was used to reduce the draw under the DDV-RCF. It can be noted that the DDV cash position at quarter-end was supported by a favorable working capital position, which is expected to normalize during the second half of the year. At quarter-end, net interest-bearing items amounted to approximately NOXI $1.0 billion, including cash and fund investments, as well as interest-bearing exposure towards ARCOVs offshore. Interest bearing receivables then decreased during the quarter, mainly reflecting the repayment of the HMA shareholder loan of US$27 million. Looking ahead, the net cash position will be affected by the approved dividend scheduled for later this quarter. Then the overview of our external financing facilities. The corporate US$30 million RCF was cancelled in May. The facility had been suspended following the HMH IPO due to the release of Legacy Share Pledge over HMH shares. Given Acaster's strong liquidity position and ongoing work towards a better suited financing solution, the facility was cancelled to avoid ongoing commitment costs and remove structural constraints related to the HMH shareholding. As mentioned also last time, we are evaluating a new corporate backup facility potentially linked directly to listed HMH shares following expiry of the lockup period. This would provide a more flexible and cost-efficient alternative to the last facility. For DDV Offshore, their revolving credit facility was reduced to US$7 million following the sale of Scandi Emerald, with 2 million drawn as per end of June. At quarter end, total available liquidity amounted to 560 million, including 44 million of cash held within DDV Offshore. This then represents cash and fund investments only, as a customer no longer has a corporate RCF in place, and the undrawn portion of the DDV facility is not included in this liquidity metric. Then over to our consolidated P&L. Again, as a reminder, most of our holdings are not consolidated in our group financials, and as a result, consolidated revenue and EBTA represent only a limited portion of underlying values. DDV Offshore deliver total revenues of 156 million in the quarter, including the 101 million related to the gain on the sale of Scandi Emerald. Operationally, Scandi Emerald reported limited utilization, reflecting the sale completed in May, while Peregrino remained on contract throughout the quarter. EBTA amounted to 113 million, driven by the gain related to the sale. Other EBTA was negative by 19 million, and in total consolidated revenue on EBTA for the quarter amounted to NOC 156 million and NOC 94 million respectively. Then some details on our net financial items. Financial investments contributed negatively by 1 million, primarily driven by the share price decline in Aqualis during the quarter, partly offset by positive valuation effects related to our investment in NAS. FX accounting effects contributed positively by 30 million, and combined with net interest income of 5 million and other financial income of 6 million, total net financial items contributed positively by NOC 41 million in the quarter. Total net negative contribution from equity accounted investments was NOC 137 million in the period. HMH contributed a net negative of 120 20 million, primarily reflecting IPO-related effects. The negative contribution relates to the reduction in our customers' ownership through the IPO at the valuation below carrying value of our investments, resulting in a dilution loss recognized in the P&L. The result was further impacted by IPO-related costs recognized by HMH during the period. As mentioned earlier, following the IPO, HMH is accounted for using the equity method, meaning that our carrying value now represents 36% share of HMH reported equity and is independent of subsequent movements in the listed share price. Other investments contributed negatively by 17 million. With that, we are through the presentation and we'll move over to the Q&A session. We will take a short pause in order for the listeners to provide their questions. We'll be We have a few questions regarding the HMH ownership and our strategy for realizing that ownership. So Kala, I'll start with this for you. How should we think about our customers ownership in HMH following the IPO?
As mentioned, the IPO was an important milestone for us, both establishing a public market valuation for HMH and also generating liquidity for a costo and also after the IPO and the green zone exercise we received approximately 53 million US dollar in cash proceeds and repayment of the shareholder loans we had to HMH. The current lockup arrangement expires towards the end of the third quarter. While a cost of strategy remains to realize value over time, we are under no pressure to sell shares at a specific point in time. Our focus will remain focused on maximizing shareholder value and we will continue to assess potential future sales based on market conditions, liquidity and also overview on underlying values in HMH. At the same time HMH remains of a largest investment and we continue to see attractive value creation potential through operational execution, margin improvements and also continued growth in the in the HMH business going forward.
Thank you Kalle. Then partly a related question. How should we think about future shareholder distributions going forward?
Well, our approach here will remain unchanged. We seek to return excess capital to shareholders when realizations occur, but at the same time we're maintaining a strong balance sheet. During the first half of 2026, we have returned 1.90 NUC to our shareholders and with this last announcement today additional dividend of 0.50 per share. Further distribution will continue to be assessed in light of realized liquidity and capital requirements.
Thank you. Then we've received some questions regarding the the recapitalization of NES, so I'll take one of those. Can you elaborate a bit around the potential recap of NES-Furcroft following their refi?
Yeah, so NES did this, I would say, successfully refi of this 650 million secure bond and primarily serves to refinance the company's existing debt and also establish a more flexible long-term capital structure for the company and as disclosed in the bond documentation the financing structure allows for shareholder recapitalization subject to leverage and other conditions has to be satisfied the documentation includes capacity for dividend recapitalization of up to 350 million dollars although the eventual amount timing and structure remains subject to find the conditions and approvals. From a costo perspective, the refinancing is an important step as it improves our financial flexibility for Nesfaircraft, while also creating the potential for cash proceeds to shareholders. Currently we are not providing guidance on the fund size or timing of the shareholder distribution but we can confirm that Acosto expect to receive its proportional share of proceeds and ultimately distribute this to our shareholders given approval from our board of directors. Overall we view the refinance as a positive development for both Nes Faircroft and Acosto supporting a strong capital structure which also create additional avenue for further value creation for the company.
Okay, thank you Calle. Then we have received a question on the Akos refi which I can comment on. Akos refi, could you expect to see a realization of the shareholder loan in favor of the external financing and what is the timeline there? So as we have mentioned in the presentation the refinancing process in Akos is progressing and we do in terms of timeline we target a completion during the second half of this year, subject then of course to final documentation approvals, etc. And we do see good engagement from financing providers, supported of course by Akov Strong contract coverage and their backlog and also of course their stable operational performance. When it comes to the intention, the proposed financing that we seek is primarily to refinance the company's existing debt facilities and establish a long-term financing platform aligned with the new and prolonged contract portfolio with aligning that with debt maturity profile. And also we do aim to secure funding for the exercise of the purchase option for Acquire Wayfarer, which is then expected to be called later this year with settlement in 2027. So the proceeds from a refi are intended to refinancing existing debt plus than the acquisition of Wayfarer, in addition to, of course, general corporate purposes. But we do not see at this point a realization of any shareholder loan in connection with this refi. Yeah. So then we have one other question on NES, which goes to the recap. Is this a substitute to a sale or an IPO? Any updated view on the exit optionality? I can comment briefly on that since Kalle, you have already sort of mentioned the most there. But I think this is viewed as two separate matters and the refi and potential recap that primarily reflects the company's operational performance and cash generation, which is strong and then the desire to optimise capital structure. So the new bond, as Kalle said, provides a long term financing platform and also then creates a potential to take out some cash for shareholders. From our perspective, I think it's fair to say that our ownership agenda then remains unchanged from what we have said previously. And we see this potential realization of the full value in NES as a separate matter to the recapitalization and refinancing of the company. Then one last question received regarding the Peregrino vessel. Do you have a view on potential contract renewal of the options for Scandi Peregrino after November? I can take that as well. The current contract, as you've seen on the slide, includes a series of priced options that can extend the firm period for up to, I believe, 16 months after November 2026. So there is a such mechanism already in place that could provide continued utilization on on that vessel. And of course we maintain a dialogue with the customer regarding those options. But at the same time we assess opportunities in the broader market to ensure continued utilization and to maximize the value of the vessel. And the market as we view it remains active in several regions and then also in the regions where Peregrino is situated and we do believe the vessel is well positioned based on its operational performance and contract track record also beyond November and even if the options should not be declared. So with that, I think that concludes our session. I would just like to thank you all for your attention and we look forward to welcoming you back for the presentation of our third quarter results in November. Thank you very much.
