Frontline - Q1 2024

Transcript

Operator (participant)

Good day, and thank you for standing by. Welcome to the Q1 2024 Frontline PLC Earnings Conference Call and Webcast. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please note that today's conference is being recorded. I would now like to turn the conference over to your CEO, Mr. Lars Barstad. Please go ahead.

Lars Barstad (CEO)

Thank you very much, dear all. Thank you for dialing in to Frontline quarter earnings call. The first quarter of 2024 was to a large degree, tainted by the security situation for the passage between the Red Sea and the Gulf of Yemen. Sorry, the Gulf of Aden, in fact. There are still, charters insisting and owners willing to go through the region, ignoring the security for the seafarers. But we, at Frontline, we simply don't. The highlights of Q1 of 2024 was that all the Euronav vessels are now sailing under the Frontline flag. And as we progress into 2024, we will take the full advantage of having a fleet of 41 modern, low-consuming, VLCCs, in addition to our efficient Suezmax and LR2 fleets.

Utilization seems to be edging higher on all asset classes, but again, the LR2s are the ones to shine. Before I give the word to Inger, TC numbers on slide three in the deck. So in the first quarter of 2024, Frontline achieved $41,100 per day on our VLCC fleet, $45,800 per day on our Suezmax fleet, and $54,300 per day on our LR2/Aframax fleet. LR2s have been yielding VLCC numbers in the quarter, as this segment has been affected the most by the disruptions in the Suez Canal passages. The Suezmax is actually called that for a reason. Hence, the change in flows has forced this sector to new trading patterns during the quarter.

So far, in the second quarter of 2024, 78% of our VLCC days are booked at $60,400 per day, 73% of our Suezmax days booked at $46,400 per day, and 72% of our LR2/Aframax days at a very firm $64,700 per day. Again, all these numbers in the table are on a load to discharge basis, and they will be affected by the amount of ballast days we end up having at the end of Q2. I'll now turn to Inger for the financial highlights.

Inger Klemp (CFO)

Thank you, Lars, and good morning and good afternoon, ladies and gentlemen. Let's then turn to slide four, and look at the profit statement. In the first quarter, we report profit of $180.8 million, or $0.81 per share, and we also report an adjusted profit of $137.9 million or $0.62 per share. Adjusted profit in this quarter increased by $35.8 million compared with the previous quarter, and that was primarily due to an increase in our TC earnings. That was also, again, due to delivery of the 24 VLCCs from Euronav in the previous quarter and also in this quarter, and also to higher TCE rates. Again, this is partially offset by an increased ship operating expenses, depreciation, and finance expense as a result of delivery of the 24 VLCCs from Euronav.

Let's then look at some balance sheet highlights in slide five. The balance sheet movements this quarter are related to taking delivery of the remaining 13 of the 24 VLCCs acquired from Euronav last year. Frontline has a strong liquidity of $404 million in cash and cash equivalents, including undrawn amounts of their senior unsecured revolving credit facility, and also the marketable securities and minimum cash requirements to the bank as per March 31, 2024. We have no remaining new building commitments and no meaningful debt maturities until 2027. If we then look at slide six, let's move to that one.

Following the delivery of all the 24 VLCCs that we acquired from Euronav, and also the sale of the seven older vessels in the first and second quarter of 2024, our fleet consists of 41 VLCCs, 23 Suezmaxes, and 18 LR2 tankers. The fleet has an average age of 5.9 years and consists of 99% eco vessels, whereof 56% is scrubber-fitted. We estimate average cash costs for the break-even rates for the remainder of 2024 were approximately $31,200 per day for VLCCs, $23,500 per day for Suezmax tankers, and $22,200 per day for LR2 tankers. The fleet's average estimate is about $27,100 per day. This is slightly up from the previous quarter as a result of the financings and refinancings done.

The fleet average estimate includes dry dock of two Suezmax tankers and five VLCCs in 2024, whereof two Suezmaxes and two VLCCs will be docked in the second quarter, one VLCC in the third quarter, and two VLCCs in the fourth quarter. We recorded OPEX expenses, including dry dock, in the first quarter of $8,100 per day for VLCCs, $8,800 per day for Suezmax tankers, and $7,400 per day for LR2 tankers, and this includes dry dock of two Suezmax tankers. The first quarter fleet average of OPEX, excluding dry dock, was $7,700. Then we can move to slide seven. Frontline has about 30,000 earnings days annually, whereof about 28,000 are spot days.

The cash generation and potential at current fleet and spot market earnings from Clarksons Research as on May 29 of $55,900 per day for VLCCs, and $50,000 per day for Suezmax tankers, and fifty-five thousand five hundred dollars for LR2 tankers, is $835 million a year, or $3.75 per share. If you look at this slide, to the right-hand side, we can see that 10% increase from the current spot market will increase the potential cash generation with about 19%. And with this, I leave the word to Lars again.

Lars Barstad (CEO)

Thank you very much, Inger. Let's move to slide eight and have a look at the current market narrative. We're still in a situation where the situation between Israel and Hamas and between Israel and Iran; we are in an environment with growing political risk. We're also seeing increased sanctions evasion scrutiny from the U.S. and EU, and this causes kind of what I refer to formally as the gray fleet to move further into the dark fleet, which is growing as we move forward. On the very positive side, the global oil demand is now estimated, according to EIA, to reach all-time high in June at 103.76 million barrels per day.

I think we need to kind of recognize that, although you know, we are in a transition mode into greener fuels, and then, you know, we're part of the green transition. But as the overall energy demand globally is growing, oil and hydrocarbons plays a part and continues to grow. What's kind of very interesting in Q1 and following into Q2 has been that the period markets have really started to show some strength. On the chart on the right-hand side, I've basically used Clarksons indices to. We're looking now that a VLCC, a three-year time charter from the Eco scrubber VLCC, is closing in on $55,000 per day.

This puts the time charter market actually in almost like a contango, where one year, two year, and three year time charters for VLCC are actually that differently. We also, you should note that the LR2 and the Suezmax market is more or less priced equally. Another exciting kind of development is that the TMX pipeline is now kind of the expansion is coming into reality, and we're starting to see or will start to learn how that oil will move. We're talking about 650,000 barrels per day when the expansion is finished into the Pacific Basin. And that will have an effect on basically utilization in that region. But we need to the port where the TMX pipeline comes out can only cater for Aframaxes.

It cannot cater for STS operations, and there is virtually no storage there. So we'll see trading patterns where depending on where the oil is heading, where you'd either have Aframax taking down the coast to a suitable STS location or going into the US refining system. And lastly, on that note, the Dangote Refinery, which, I know that the market has kind of speculated how that will affect ton miles going forward. It's a significant refinery starting up in Nigeria, finally, after 16 years of... It's quite interesting to see that they are also then taking feedstock from the U.S. Gulf, which is not expected, sitting next door to, you know, Nigerian crude supply. The order books continue to grow, but, as the order books grow, the delivery window up in time, and I'll get back to that later.

We see that, on the charts at the bottom on the slide, you see that the VLCC, I've said it many times now, we seem to be in this kind of grind, positive grind, where the bottoms are higher, for every cycle we go through, and that still seems to hold. The Suezmax, I mentioned it, you know, as in the introduction, Suezmax and Suez Canal are connected. So Suezmaxes seem to be very range bound around the $40,000 per day and doesn't really seem to have legs to go anywhere. But, the LR2 are the ones to shine, they're most affected by the disruptions in Suez Canal passage. And we see the volatility is increasing.

We're also seeing examples, and Frontline has participated in Suezmaxes cleaning up in order to, kind of, compete in the, particularly gas oil, going from the Middle East Gulf to, to, west, westbound. So let's move to slide nine, and look at some of the kind of developments in flows. I have kind of talked about this earlier. OPEC is maintaining its cuts, which is predominantly located around the Middle East Gulf. Non-OPEC supply has been given kind of the opportunity to grow, and this growth continues. So, on the top left-hand side, you can see ton miles generated from America's oil exports. Americas is basically the whole continent, included, and we see that continuing at a very, very kind of high level. And we also see VLCC are starting to get favored, particularly so in May.

This basically is an indication that a lot of this volume is going long haul. We also see that Europe continues to draw oil from a kind of longer distances on the bottom left-hand chart. So the ton-mile generation by Europe, avoiding Russian crude, is continuing. But I think lastly, and very interestingly, we're seeing actually that in very close to the source, it could be in the Middle East, is as imports grow, are in a much larger degree, pulling oil further afar, so basically westward. Let's move to slide 10. The order books continue to grow. We're now, and then again, this data is based on a registered vessel, so based on IMO numbers issued. So I think confident that these numbers will grow as more and more are confirmed.

We now have an orderbook-to-fleet ratios of 4.4%-6% on whole fleet. Grew to 6.4% or 9.6% on the existing fleet. And then, basically, more ordered in these, you know, in the last couple of years have been crude tankers, is now reached a level of 26.6% of the existing LR2 fleet. But I think one has to take into consideration here, that as LR2s pass 15 years, they tend to turn into Aframaxes. And I think kind of to truly reflect the picture in the Aframax size class, one should actually include the overall Aframax number, which would, you know, drastically reduce this percentage. But anyway, we continue to see these orderbooks grow, but to a lesser and lesser degree in 2027.

And actually now we're talking about 2028. And let's move then to slide 11. And I think if there is one slide that's important in our quarterly presentation this time, it's this one. And I, you know, have a look at the bottom left-hand chart. So from 2024 onwards, we're in fact hitting a wall of replacement needs. Based on tonnage that has to be phased out at the age between 20 or 25 years, depending on asset class, there is a monster of vessels that, or deadweight tons, that was built between 2004 and 2011, that basically come to age. 2011 was the absolute peak year of new building, and this is again, all asset classes included.

At that point in time, we had 519 shipyards in the world. Now, we have 247 shipyards in the world. So, in amount of shipyards globally, the number of yards has been reduced by 52%. Roughly based tons capacity, as some of these yards are bigger, the reduction is somewhat less, being 40%. We're seeing that in South Korea and in Japan, they're struggling, basically, to be able to expand this, the existing yard capacity, basically due to demographics, you know, being able to attract workers and so forth.

I've said it on a few presentations in South Korea, we're looking, you know, they actually need to take in the workers from Philippines to get basically the capacity needs. In Japan, you know, one is saying that the average age of a welder is 56 years. So this is a demographic challenge. There's not that many kids in South Korea and Japan that really, really wants to work in a shipyard. China has potentially a lot of capacity, but this is a structural supply story. You know, in order to replace all this tonnage that needs to be replaced over the next 10 years, we have an issue.

If you look at on the tanker replacement alone, we're actually, you know, if you put the long goggles, the big goggles on, you know, from now until thirties, we need more than close to 400 VLCCs built. We need 300 Suezmaxes built. We need 187 LR2s built and close to 400 Aframaxes. So this is kind of massive, and it's a structural problem, so it's not easily solved. And as all market intelligence agree on oil demand to continue to grow, you know, although ton miles may contract short to medium term, if Ukraine, Russia is resolved and if the Red Sea passage is opened up, one cannot escape the fact that shipping supply growth looks to be challenged. With that, let's move to slide 12 and go through the summary.

So again, the highlight of Q1 for Frontline is that we have a fully delivered VLCC fleet sailing under the Frontline flag. We've concluded the sale of, and it's given Frontline one of the most fuel-efficient fleets in the market. We finalized and inked the expansion in financing, completing our strategy of re-leveraging the existing fleet. The security situation in Red Sea, Gulf of Aden, and Middle East in general remains. There's continued contracting in the tanker markets, but building capacity is coming into question as delivery dates now move into 2028. Short and medium-term oil demand picture remains firm, and we're also kind of being alerted by the market that the OPEC+ extension in second half of 2024.

There is increased liquidity in the period markets with long-term time charter rates moving up, and this is, in all fairness, the intelligent money coming into the market. With that, I would like to open up for questions.

Operator (participant)

Thank you, sir. As a reminder to ask a question, please press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. Once again, please press star one and one on your telephone and wait for your name to be announced. Thank you. We are now going to proceed with our first question. The questions come from the line of Omar Nokta from Jefferies. Please ask your question.

Omar Nokta (Managing Director)

Thank you. Hi, Lars and Inger. Good afternoon. Thanks for the presentation. Always very detailed and informative, across different elements of the story and the market. I guess a couple questions from me, maybe just first on the financing. You as you just highlighted, you finalized and inked the expansion financing. You've unlocked a good amount of cash here recently, and it looks as if I'm just telling the numbers, $417 million has been unlocked, and that's gonna basically repay the Hemen Holding borrowings of $395-

Lars Barstad (CEO)

Yes

Omar Nokta (Managing Director)

... which was used initially on the Euronav deal. But what about the seven tankers, the seven older ships you just sold? Those unlocked $275 million after you paid down the debt. Is that cash earmarked for anything in particular, or will these go into further debt reduction?

Lars Barstad (CEO)

You have to remember that we used more to finance the Euronav vessels than the $395 million that we drew under the Sterna facility and also the Hemen shareholder loan. We spent some cash from operations until we sold the vessels, the older vessels. So that's the answer to your question.

Omar Nokta (Managing Director)

Okay. Yep. So just as simple as that then. Okay. And I guess just more kind of sticking with you know, Lars, you talked quite a bit about the market and the LR2s being the sector that's shining. And you've also talked about TMX. How are you thinking about the LR2 fleet and the way it's trading currently? Or how are you balancing say the LR2s between dirty and clean, given the strength in the outside-the-Suez market and then also the potential pull into Vancouver?

Lars Barstad (CEO)

Yeah. No, it's a good question. This is a time where we probably would have wanted to have some Aframaxes in our fleet, to be quite honest, you know. But, so back to the question in regards to the LR2 shining, you know, this is obviously related to the fact that, you know, with the Suez Canal virtually closed, products, you know, from east to west, the Aframaxes work periodically, but west to east, there is very little material going. You need to incentivize an owner to actually ballast the ship going east, and that means that the rates actually have to go up. So the utilization of the LR2 fleet is simply increasing quite a lot, basically by this inefficiency.

You know, and also to the point where, you know, great efforts have been done in order to clean up Suezmaxes for this trade. And clean Suezmaxes can obviously not cater for all the cargoes. Basically, it has to, you know, gas oil is probably as far as it goes. But, you know, this is basically what's driving this market. Dangote, sorry, TMX, I don't think we've seen that fully affecting the Aframax market. But, you know, at least, as we can see now, as with the, you know, the market is developing or evolving, it looks like a lot of these barrels are actually going west, sorry. It's the other side of the world.

Basically what we see is a trade emerging where Aframaxes will go up and down the coast. You have certain STS locations in, you have some in U.S., you have Mexico and you have Ecuador. Ecuador, you also have tankage. And we see to exist to be where you collect the oil from TMX on Afras. So increasing the utilization in fact on Afras to some extent, but not necessarily to the extent as if the Aframaxes were going all the way west to China. And then STS activity and then put into VLCCs, that takes it over to or west to clients there. So I think we still need to have a look at this trade for a few more months until we understand how it's gonna work.

But you could say that the worst case scenario, which is obviously the best case scenario for a shipowner, is that all this, you know, you need to load an Aframax every day. So, you tow ships, and if they need to travel for 40 days before they discharge, you have 80 days until they're back. It's gonna take a lot of vessels. But as far as we see, you know, initially, is that it doesn't, you know, you don't use that amount of days because you're basically just going down the coast to a possible STS location, and then it's a larger vessel. And so far, it looks like going into VLCCs.

Omar Nokta (Managing Director)

Okay, thanks, Lars. That’s helpful. And just a final one for me, just kind of on the VLCC performance in the first quarter. The repositioning of the Euronav ships is obviously there’s a big divergence between what your initial fleet earned and what those ships have done. Should we think about further repositioning dynamics in the second quarter? And then is 3Q really the first kind of true quarter of ongoing operations on the VL?

Lars Barstad (CEO)

Yeah, I think you have a good- but there are a few points I wanna make. Number one is, one has to remember that the Euronav fleet has a lower scrubber penetration than the, you know, former, you know, the existing Frontline fleet prior to the transaction. So that obviously affects the earnings you can get. So secondly, you know, initially all the vessels were delivered, on basically all the vessels were delivered around Singapore. So we had kind of, you know, introduction trade that, that, maybe didn't yield what we would have wanted. It's also a timing issue when this entered the market.

We got them very concentrated in time, so it meant that, you know, we hit basically a very narrow window in the Middle East, which, you know, just to top it was the weak spot in Q1. But anyway, I think you're absolutely right. As we move forward here, you know, we'll spread the fleet more evenly around the globe. And you know, we will see that the Euronav vessels will just blend in, and we're probably not gonna comment on you know or kind of distinguish between the two fleets going forward as we report.

But also, you have a very good point in, you know, these ships are done on long voyages, so it takes a bit of time before everything is kind of, you know, fully acclimatized or whatever the word is, into to the total fleet. So, Q2 will maybe to some extent be affected, but Q3, we should be running a normal show.

Omar Nokta (Managing Director)

Okay, very good.

Lars Barstad (CEO)

But obviously to a lesser degree in Q2 than Q1, obviously.

Omar Nokta (Managing Director)

Okay. All right, so 2Q will be-

Lars Barstad (CEO)

Mm.

Omar Nokta (Managing Director)

better, and then three Qs full on. Okay.

Lars Barstad (CEO)

Yeah.

Omar Nokta (Managing Director)

Excellent. Thanks, Lars. Thanks, Inger.

Lars Barstad (CEO)

Thank you, Mark.

Operator (participant)

Once again, as another reminder, to ask a question, please press star one and one on your telephone and wait for your name to be announced. Once again, it's star one and one to register for questions. Thank you. We are now going to proceed with our next question. The question comes from the line of Greg Lewis from BTIG. Please ask your question.

Greg Lewis (Managing Director)

Yeah, hey, thank you and good afternoon, and thanks for taking my questions. Lars, you know, it looks like, you know, the depth of the time charter market's picking up. I mean, obviously, you're taking advantage of that. You know, as we look at the back half of the year and the outlook for rates and the spread between, I guess, the curve and spot market, you know, I guess kind of curious what you're seeing and how you're thinking about the opportunities to continue to put some vessels on some term charters.

Lars Barstad (CEO)

So we're constantly kind of... But I think, you know, keep in mind that, you know, our view is that, you know, we're in for a longer one here. I hate saying it because we used the expression stronger for longer back in 2020, and that was absolutely not right. But there we were actually quite aggressively chasing contract coverage. But now we are watching it, and we want to kind of you know, it makes sense. We want to lean into the market, but we're not gonna kind of, you know, we have like a rule of thumb in Frontline that we try to cover 30% of our largest exposure, you know, being revenues, interest rates, and the bunkers.

So that's kind of the rule of thumb. We're very close to that, or fairly close to that on interest rate swaps. Fantastic timing. On the bunker side, we're a bit below. On the revenue side, we have virtually, you know, apart from on the LR2s, we have virtually zero revenue kind of secured going forward. But we will lean into this, but we are in absolutely no hurry because we believe this cycle kind of gradually getting into here, and back to the, you know, I mentioned this structural issue you have in the supply side and oil demand looking to be very, very resilient, it's gonna take us a little bit of time.

So, but, you know, we want to ask me, you know, when or-- well, it's always a when, we get out of this cycle, we want to have some proper coverage, but we're not aggressively pursuing this right now.

Greg Lewis (Managing Director)

Okay, great. And then just I did wanna ask a little bit about, you know, you had those asset sales. You know, I guess looking at the, you know, maybe you have two more Suezmaxes that are in that 2010, 2011 range. You know, like we kind of agree with the outlook for the market, where, you know, generally in previous cycles, older vessels have outperformed or, you know, the spread has converged for older vessels versus modern tonnage, and it's typically made sense to own the older vessels in bull markets.

And just kind of curious, I mean, I guess since the Frontline acquisition was announced, we've sold 16 vessels, and so, you know, I guess my question is: do you see this cycle playing out differently, where there's that much more discrimination against older vessels that maybe that spread that traditionally converges, you know, during these multi-year up cycles doesn't play out the way it has historically has?

Lars Barstad (CEO)

That's a big question. I think kind of in our analysis and when looking at this market, you know, we, as I've said numerous times, do subscribe to this kind of notion about the revenge of the old economy. So the way this is gonna play out is, which obviously it hasn't yet, but, you know, oil prices and everything is gonna kind of go commodities boom, that we're facing going forward. And with that, we'd rather have the most efficient tools. We are seeing some scrutiny, preference from clients for more efficient tonnage. We cannot forget the regulatory framework we're facing. To have an effect, kind of disappeared a little bit, you know, in the narrative over the last year and a half.

There is still this thing about CII, and there's still this thing about kind of energy efficiency and so forth. And we basically subscribe to that a lot, and that's a part of our strategy. I think kind of, you know, it could have been, could be that looking back in two, three years' time, that, you know, what you should have done is focus on 12-15-year-old vessels and where you get most bang for the buck. But, you know, we continue to kind of build long term, you know, to where it's gonna be in 15, 30 years. And that's basically the plan we're aiming for.

Greg Lewis (Managing Director)

Okay. Super helpful. Thank you very much.

Lars Barstad (CEO)

Thank you.

Operator (participant)

We are now going to proceed with our next question. The question comes from the line of Petter Haugen from ABG Sundal Collier. Please ask your question.

Petter Haugen (Partner)

Yes, good afternoon, guys. Thank you for taking my question. Just on the final sentence in the summary here, Lars, you talk about the longer term time charter markets, and I guess the question is in two parts. Firstly, in terms of the requirements, is it the traders or is it sort of the fundamental cargo owners which are asking for longer period? And the second part of the question, have we seen an interest for sort of 5-7 years charters for new builds with 2027, 2028 deliveries as of now?

Lars Barstad (CEO)

Thank you, Petter. First one, absolutely, yes. This is the oil majors, you know, the kind of the guys who have transportation needs. So this is basically the big boys entering the market, oil majors, national oil companies, and so forth. Secondly, yes, there is interest for longer term business in the market, so maybe not 10 years, but five to seven years, definitively, and seven years charters, absolutely. So, but you know, this is kind of a little bit different market. And you know, just to remind everybody, our proposition to our investors is to give you spot exposure. These kind of deals, we might, you know, we're very likely to pass on. We don't have an order book either.

But it is absolutely, you know, starting to emerge, you know, a market around these longer-term deals as well.

Petter Haugen (Partner)

If I could just follow up on that, what sort of rates would you expect? Let's say that if you had a new build with 2027 delivery, what sort of rate would you expect to get for a 5-year time charter deal from there?

Lars Barstad (CEO)

That's a big question. It's a difficult question to answer, actually. But it looks like, you know, the curve is pretty flat, and it's all to what gives the owner a decent return on the equity. So you're talking somewhere around $50,000 per day, regardless on the deal to see that is,

Petter Haugen (Partner)

Okay.

Lars Barstad (CEO)

But that doesn't really give-

Petter Haugen (Partner)

Just to follow up.

Lars Barstad (CEO)

Sorry, the $50,000 per day doesn't really make, you know, it makes some excited, but others maybe not. It's, you know, the 2020 to 2027 delivery, depending on how, when you order it, it's setting you back $110 million - $115 million - $120 million. So it's a, it's a big number. But, you know, I, I think at least for now, that's where, where these prices are.

Petter Haugen (Partner)

Okay, thank you. And just, the final one from me. In terms of dividends, going forward here, I know that you have this discretionary policy, but, this time you pay out everything, which I think is appreciated by, well, most... How should we think about the payout ratio going forward here? And I'm thinking perhaps in particular in next quarter, because in next quarter and potentially Q3 with a summer market, it could be, well, less, I suppose.

Lars Barstad (CEO)

Yeah, I think you should, you know, kind of the rule of thumb, which is again, not a policy, is 80% of adjusted net income. And I think you, that's what you should have in the back of your head, if that's what happens. But I think also, you know, why we chose to go for 100% this time is that we have good visibility. We are in a good kind of liquidity position. And our job is to give our shareholders the money we make. So, but, you know, obviously, depending on how the markets evolve going forward, you can speculate whether if we're gonna do 100% again, or if it's gonna be 80%.

But I think it's gonna be linked to kind of the general market temperature. And this is what we've tried to do all along, is you know, kind of when the market corrects sharply downwards, we're not gonna drain the company of cash. But then again, if the market stays firm and maybe even improves, you know, we have room to unless we're you know doing something structurally that where we rather reinvest the cash on behalf of our shareholders, then you know you should be handsomely rewarded.

Petter Haugen (Partner)

Thank you for that, Lars. That was all from me.

Operator (participant)

We have no further questions at this time. I will now hand back to you, Mr. Barstad, for closing remarks. Thank you.

Lars Barstad (CEO)

Thank you very much, and thank you all for listening in. You know, these are exciting times still, although we're still missing some of the volatility we wish for. But you know, let's just monitor how these markets develop and quarters to come. Thank you very much.

Operator (participant)

This concludes today's conference call. Thank you all for participating. You may now disconnect your lines. Thank you.