Bonheur ASA
OSE:BONHR
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
181.6
286.5
|
| Price Target |
|
We'll email you a reminder when the closing price reaches NOK.
Choose the stock you wish to monitor with a price alert.
This alert will be permanently deleted.
Bonheur ASA
You don't have any saved screeners yet
Good morning, everybody, and welcome to the Second Quarter Presentation for Bonheur ASA. My name is Anette Olsen and I am the CEO of Bonheur. I have with me today, Richard Olav Aa, our CFO. He will do the majority of the presentation. In addition to that, we will introduce to you today Lars Bender, who is heading up our new business unit for Offshore Wind. And in addition to that, Alexandra Koefoed, who is the CEO of the Fred. Olsen Wind Carriers, will also talk to you about that segment. So hopefully, you will feel that we give you sufficient information. With that, Richard.
Yes. Thank you, Anette, and hearty welcome from me as well. We will -- we have sent out a presentation. And the first few slides in that presentation is part of our general investor presentation. So I think we can skip directly to Slide 6, which is the highlights of the quarter. Before going into the details of this slide, I would like to start saying it's been a good quarter. Last quarter, we indicated that our markets were improving, that we have seen coming into fruition in this quarter. Energy prices are up, we have increased backlog in Wind Service and also the Cruise business have mobilized and have 1 ship back in the water. So in general, the market is pointing into a favorable direction for our business segments. It's also been a very hectic quarter with a lot of positive stock exchange releases. I cannot recall that we had such an active quarter and a number of stock exchange releases. And they are, in particular, related to the business areas where Lars and Alexandra is going to present later today, both on the offshore wind development side and also FOWIC. So on that backdrop, I will take you through then the more detailed figures and events in the quarter. Starting to the top right in this slide, we see operating revenues slightly above NOK 1.6 billion in this quarter, which is an increase of more than NOK 300 million from the previous quarter last -- from similar quarter last year. And EBITDA in the quarter was NOK 313 million, and that was a significant improvement from a negative EBITDA of NOK 57 million second quarter last year. Also a strong improvement on EBIT of positive NOK 80 million compared to NOK 329 million negative last year. Net result after tax, still a slight loss due to sale at the Cruise business is making quite considerable losses while they are mobilizing back into the waters. That's on the consolidated level. Parent company stands very solid with an equity close to NOK 7 billion and equity ratio close to 70% and cash in the parent company of NOK 2.1 billion. Then taking the business segments one by one, starting with Renewable Energy. A strong improvement in EBITDA compared to second quarter last year. That is due to higher prices in all the markets, but maybe U.K. in particularly, and I'll come back to that in more detail, the drivers between the market prices on electricity. Maybe most importantly, within Renewable Energy in this quarter is what Lars is going to talk about later today, is that we have decided to establish a separate business unit for Offshore Wind with a dedicated management team. And this is on a backdrop of a very strong project pipeline. We have worked with the Codling project for a long time, which is a very mature Offshore Wind project and the large energy infrastructure project in Ireland in this decade, where we have a partnership with EDF that was established more than a year ago. But also in this quarter, we have further developed our Scotwind project where we have entered also a partnership with Vattenfall. We, with our long track record in Scotland being our home market, Vattenfall being one of the first offshore developers in Scotland, we think that combination can really be a winning concept in the Scotwind auction. And then we have the Norwegian situation where we already had a very solid partnership in place with Hafslund, complementing us with their hydro competence and their grid competence with our renewable contents, and that partnership has been further strengthened this quarter by adding Ørsted to the partnership. And then we have Icebreaker, the only consented Offshore Wind project in the lakes in the U.S. So we have decided to gather these 4 projects and develop a dedicated business team, a dedicated business unit for this. And we're also saying today that we will explore alternative possible financing opportunities for this new unit, including a potential listing. Moving on -- and Lars will come back to this in more detail. Moving on to Wind Service, where we had the strongest improvement in earnings and EBITDA of NOK 271 million compared to only NOK 50 million in second quarter last year. We have a new partnership with Shimizu in Japan. FOWIC is already a global leader being in -- a global leader in Europe, being one of the first movers in the U.S., first mover into the APAC region in Taiwan, and also now creating a position in Japan with Shimizu. And Alexandra will cover that partnership in more detail under her presentation. Also very positively, adding new contracts of a total value of EUR 124 million and adding solidly to the backlog of FOWIC that now stands above EUR 300 million. And Alexandra will also come back more into detail into that backlog. The results are significantly impacted in a positive way by solid utilization close to 100% and really excellent execution of the FOWIC team in the quarter on these large projects, both in Europe and in Asia. And we have spent a lot of time also this quarter further develop the strategy plan for FOWIC and especially the crane upgrades and how we're going to have a growth program, and we're saying, we're aiming for a new bid. And Alexandra will also cover that more in detail under her presentation, but a lot of great work also have been put into that in this quarter. Then Global Wind Service continued their solid performance in the quarter, both in Europe and the U.S. Then the Cruise Lines, still large losses, negative EBITDA of NOK 179 million, which is on par with second quarter last year. Second quarter last year, we had significant demobilization costs taking the cruise ships out of service. This quarter, we had significant mobilization costs bringing cruise ships into service. The first ship went sailing 5th of July from Liverpool on a short cruise around the U.K. That was done successfully. And we're now also then planning to launch the second ship Bolette in the middle of August. We see strong and substantial demand for the cruises and what we also see with the new fleet and are coming back to that under the Cruise section, the new composition of the fleet, that we should expect an improved EBITDA for the Cruise business compared to what it performed at pre-COVID-19. On the other segments, also there, an EBITDA improvement related to NHST. NHST also continued to improve their digital products and services. But maybe most importantly, around NHST in this quarter, it's been decided to create a new media division, combining all the global publication with Dagens Næringsliv to utilize synergies both on content subscription, advertising and also efficiencies. Finally, on other investments, Bonheur successfully placed a new NOK 700 million green bond, the second green bond that we have issued on the green finance framework. So that is -- that are the big events in this quarter. So we'll continue then going into a little bit more detail on the numbers. On the revenues and EBITDA that we have already comment, a solid improvement on both and especially on EBITDA with an improvement of NOK 370 million. We also see net finance that we have quite low net finance expenses this quarter. Interest expenses and other financial expenses are quite normal, but we have some unrealized gains and especially on the interest rate swaps related to renewables as interest rates have ticked up first in the U.K. in the quarter. Other than that, I don't think it's anything more special to comment on the consolidated P&L. Then a little bit more detail into the revenues. We see some changes on the currency side with pounds strengthening quite a bit compared to the dollars and Norwegian krona also strengthening compared to euro and pounds, but not impacting the revenues significantly in this quarter. But Renewable Energy, the NOK 128 million change is mainly driven by price, but we've also had very low wind speeds this quarter. So the revenues could have potentially been quite a bit higher if we had normal wind speeds. So with the current electricity prices, we should expect, in fact, even higher result than what we have in Renewable Energy at the current electricity prices. Wind Service is up NOK 210 million. That is really on the backdrop of strong utilization for the 3 turn vessels, but also some improvements in UWL and Global Wind Service. The other segments are more or less in line with the second quarter last year. EBITDA, Renewable Energy, a positive change of NOK 137 million and then an EBITDA of close to NOK 200 million. Good cost performance in this quarter was good compared to second quarter last year. And also Wind Service, the better utilization of the terms translates directly into a much improved EBITDA. And Cruise and Other, I don't need to comment further. Then going into the segments before handing over to Lars and Alexandra, starting with Renewable Energy. This is a slide we developed also in connection with last quarter's presentation. It gives you the overview of Fred. Olsen Renewables in brief. And I think this is an important backdrop now when we are setting up a separate business unit. We have been into the renewables and into wind since 1996 and established ourselves in the home markets in Scandinavia and the British Islands. And it's on the back of this and also long maritime heritage that we are now establishing a separate business unit for offshore wind. And I think we cannot underscore more how important this fully integrated in-house business model is, that we process all the skills from the site investigations and all the way through construction, operation and ownership optimization that we are a long-term developer and operator in all these case, and it's on the backdrop of that. And our strong history within Maritime and Energy, we now set up a separate business unit within Offshore Wind. Then going to the electricity market. We saw in the short term is the main driver of profitability in Fred. Olsen Renewables. Starting to the top left where you have the production illustrated with the black line, the capacity factors illustrated by the bars. This is -- the production in this quarter was quite low, only 300 gigawatt hours, which is below the norm. And you see on the capacity factors, it's really the U.K., where you have very long wind speeds in the quarter. But then on the other hand, prices have been very good. Moving to bottom left, we see the price curves for U.K. in the blue and the Swedish one in the orange one and the Norwegian one in the gray one. Starting with U.K., we've seen compared to a year ago in the midst of the COVID outbreak that we had prices down towards GBP 30 per megawatt hour, which have now increased to more than GBP 70 per megawatt hours. And then in addition, we have the renewable obligation certificates for our Scottish wind farms, makes them very profitable at the moment when it blows normally. We see the same trends in Scandinavia, maybe particular in Norway, where we've seen the prices were touching 0 last summer due to the hydro positions in Norway and lack of transmission capacity. That hydro position is now being utilized. And we see Norwegian prices now more in line with German prices up towards EUR 40 to EUR 50 per megawatt hour. Swedish prices have also improved materially, but have a little bit of a slower development than Norway due to the grid capacity from North to South in Sweden. So what is -- what are the main drivers behind these strong electricity prices? And I think we will find the answers on the 2 charts to the right, starting on the top. We have in the blue line gas prices and in the orange line CO2 quota prices. And what really sets the electricity prices in Europe these days is the cost of running a gas turbine, producing electricity, and we have 2 cost factors. It's the gas and it's the quota. And we see the gas prices have tripled since the middle of COVID and the quota prices have more than doubled on the back of very strong political measures in Brussels on the concept of polluter pays. So adding those factors and transforming that into what the gas power plant would need in electricity prices just to pay for quota and gas, you easily get to the pricing we see in the market today. And then we also have the very positive development on the hydrological balance that it did not so much rain and not so much snow in the mountains, so now the hydrological balance, as illustrated to the bottom right, is back to normal. Then we have, on the construction side, an update on Högaliden. We are, in fact, finished, but the supplier had some faulty blades, especially around the inserts of the blades that needs to be repaired, and that takes some time. They are shipped to Denmark and being repaired. And we expect now that all 25 wind turbines should be in production by October this year. We already have 11 turbines up and generated. We are covered contractually on this, so it does not expect any negative financial consequences from this delay. And maybe what is maybe more important looking forward is what you see on the picture to the bottom right, is this is the first wind farm in the world where we have a turbine mounted lidar, i.e., wind measurement equipment that is seamlessly integrated with the control systems of the turbine where the purpose is to optimize the performance of the turbine by reading the wind early on. So this is a new innovation together with such as lidar, Vestas and clouds changing levers, which we have high hopes for.On the business model and project portfolio of FORAS, there are a few developments this quarter, the most important one is the continuing development of strong partnerships to the left, where we have the additional Vattenfall in Scotland, additional Ørsted in addition to Hafslund in Norway and then the establishment of a separate business unit that Lars will cover. That's maybe the most significant development on this slide this quarter. But we also have good progress on the development side in Scotland and Sweden. Scotland, adding another 100 megawatts to their portfolio and Sweden adding more than 100 megawatts to their portfolio. So we have built another 200-plus megawatt on the development portfolio this quarter, which is very positive. On the consented side, there are no new developments this quarter. And on the construction side, we already gave you an update on the Högaliden site. Yes. Then I think it's time for me to hand over to Lars Bender, which is in Denmark, and will present our thoughts around a separate business unit for offshore wind.
Thank you very much, Richard. As a short introduction to myself, my name is Lars Bender. I joined Fred. Olsen Renewables roughly a year ago, where I have been focused on offshore wind, working mainly with strategy, but also the partnership which Richard mentioned earlier. And I have a background in offshore wind, working in offshore wind last roughly 8 years, latest as part of the management team in a company in Denmark, which is a global leader within production of foundations and top sites. I'm naturally very happy to present what I am going to present today. It's a fantastic venture into offshore wind. But before diving into the details of what's going to happen, I thought it would be a good idea to provide a bit of context and history in relates to why are we here today and why are we taking these next steps. And the context is that we have a solid platform to stand on in relation to mature project in Ireland Codling Bank, which I'll come a bit back to. We have a well-established position in Norway and Scotland. And in addition, we have entered into partnerships with industry-leading players. So over the last years, we've worked intensively in relation to creating this platform, and that is the basis of why we are now taking a step into a new phase, so to speak, putting more effort and more dedication into offshore wind. And what we are going to do is what Richard mentioned earlier, we are going to establish a separate business unit with a dedicated management team. This, we are naturally doing to put dedication and effort into offshore wind, but also to build a strong and solid organization around our already existing activities, but also to create more activities going forward. The task of this team will be to follow up and develop existing projects and positions in home markets. That is, of course, Ireland, Scotland and Norway. But it will also be to expand the portfolio of projects further. In addition to that, as Richard already mentioned, we will also investigate possible alternative financing opportunities, including public listing. So these are the next step for us into offshore wind based on the platform, which we have established over the last years. Next slide, please. To give a short background to offshore wind in Fred. Olsen. First of all, very important is that we are standing on the basis of an existing attractive portfolio of projects and positions. The Codling Bank project in Ireland is the largest Offshore Wind project. It's very well positioned and no doubt a strategically important project for us and a project which we have high belief in. It's a mature project, so focus will be on developing that in the coming years. Then in addition to that, we have created a position in Norway around Sørlige Nordsjø II and Utsira Nord together with Hafslund and Ørsted as partners. We will end up this week, submit a bid into Scotwind together with Vattenfall. And then we have the Icebreaker project. As Richard mentioned, it's the only consented project in the Great Lakes and a position for us in the U.S. in relation to offshore wind. Then based on this platform and portfolio, we will use this to position to establish ourselves even further in home markets, building on the existing portfolio. So focus will naturally be to expand in Ireland, Norway and Scotland, going further and building a further and stronger portfolio. Obviously, when we are able to do this, it's because we are basically standing on the shoulders of the Fred. Olsen system. We have a long-time experience within wind development, understanding wind resource analysis, which we've done for many years on onshore wind. And that experience, we are now taking offshore. In addition to that, we have over the years developed various technological solutions. An example could be a concept around mobile corp, where we are developing a concept for installation of wind turbines floating. So that is some of the things which we expect in the future will be a differentiator for us in raising to offshore wind that we are an industrial player, which has an additional ability to develop technology and other things in our related companies. Next slide. As mentioned before and just to give a view of how will a time line look in relation to developing the portfolio. As mentioned, the first project, which is mature in development is Codling Wind Park that will, over the coming years, be developed and ready for CfD and later FID. Next focus will time-wise be extensions in Ireland to the Codling Wind Park, of course, leveraging on cost synergies from the Codling Wind Park project and using the existing knowledge we have around the Irish regulatory system, but also, of course, what we have learned from the current project we are doing in Ireland. Then the next phase will be in Scotland and in Norway. We expect that at the end of this decade, build-out will start in Norway, but also in Scotland. Then we will use the same strategic approach that when we developed the first projects in these home markets, we will then extend and develop further projects based on that experience in those existing home markets. In addition to that, we will look at new markets as well, of course, leveraging the experiences across the companies in relation to offshore wind, but also from onshore wind. Next slide, please. And just to give an impression of what Richard also said a bit about in the beginning, we have had a busy quarter in relation to stock exchange notices and partnerships. That is fantastic. Obviously, that's the product of a lot of work within the companies from a very strong team who has been, over the last months and almost years, working with an approach to develop partnerships and to create a strong position for us in home markets. And that has resulted in what you see on the slide now that we, in Ireland, are partners with EDF around the Codling project in a 50-50 joint venture. In Scotland, we are partnering with Vattenfall in a 50-50 joint bidding agreement. Of course, in Scotland, we are leveraging the Fred. Olsen experience and heritage. We've been a part of the onshore environment in Scotland for many, many years in the system. There are significant jobs created in Scotland on that basis, and we now take that experience into offshore wind. Vattenfall is bringing their experience from, amongst other things, Aberdeen Bay, which is one of the offshore wind projects in Scotland. And together, we want to create a strong position in creating local value in Scotland to the benefit of Scottish government and, of course, creating Scottish jobs. Then we have Norway where we've entered into a partnership with Hafslund and Ørsted. It's a long-term partnership together with those for both floating and bottom fixed wind. The reason for a long-term partnership is that we believe that Norway will develop into a significant offshore wind market. And we believe that creating value for Norway is important. And therefore, it's important to look long term on value creation for Norway as well. Firsthand will, of course, be focused on the lease rounds coming up for Sørlige Nordsjø II and Utsira Nord where we together will submit a bit into those rounds. Our focus in Norway have been around creating subsidy-free offshore wind in Sorlige Nordsjo II, combining offshore wind with a transmission concept. On Utsira Nord, we will focus on creating bottom fixed wind -- sorry, floating wind, which is based on creating jobs and also new technologies for the Norwegian market. So in all 3 areas, we believe we've created strong positions together with partners, and believe we have a really good position of bringing this forward and also, of course, winning in these respective countries. Thank you for that. And back to you, Richard.
Yes. Many thanks, Lars, for a very good presentation of this new initiative. I think we can go then straight to Alexandra, and then I will do the rest after Alexandra's presentation.
Thank you. I will present a little bit about what Fred. Olsen Wind Carrier have been up to in the last quarter, but I will start with just reiterating who are Fred. Olsen Wind Carrier, and we are a market leader in the growing offshore wind market. So looking outside China, we have installed 20% of all offshore wind turbines, which I think we can be proud of. We are currently installing turbines. So the numbers you're looking at the screen now being outdated every single day. And by the end of the year, we expect those to have past 800 and also 5 gigawatts installed in total. As mentioned in the beginning, we are a global company. Our main activity and foothold have been in Europe as for offshore wind, but we installed the first offshore wind farm in the U.S. back in 2016. The U.S. has been a little bit slow since then, but is now starting to move very fast, and we also were one of the very first movers out in APAC, in Taiwan, where we located a vessel last year. And as mentioned, we have now strengthened our foothold in APAC with a MoU with Shimizu, which is a large contractor in Japan. And just to mention what we're currently up to, Brave Tern is in Taiwan, installing turbines, Bold Tern is on her way to yard and Blue Tern is in Scotland installing turbines. Then I would like to touch a little bit on the offshore wind market and the offshore wind turbine installation vessel market in particular. Some of the growth or most of the growth we're seeing in this offshore wind market is driven by increased turbine sizes, which have reduced the cost of energy, which again have made offshore wind possible to build subsidy-free. These large turbines results in current equipment being outdated, which I'll come back to. But generally, what we see up until now, we've had a offshore wind market with slightly variable activity from year to year. What we see from '24, '25 going forward is a very significant uptick in activity. And also, we expect a much more level activity. And the numbers you see on the screen, this is not gigawatt, but numbers of turbines, which we are mainly occupied when we installed turbines. And we'd love to be pay per megawatt. But it is totally fine. So then reiterating, if you are looking at the fleet out there working today, I think there are actually nonexisting vessels there are certainly some of the way. But there are none of the vessels installed in turbines. As of today, that is that can install these 14 megawatt, 15 megawatt turbines that we see coming to the market. So that will be necessary when significant changes in the fleet. There are a handful or more that we assume can and will be upgraded, there will be new builds that even with what's announced today and we do see as a prior gap coming into '24, '25, '26 which is good news, I guess, for us as vessel operators. Then I'll touch upon one of the docket change notifications that came out earlier this quarter, and that was related to vessels that have been carried backlog which we then stated was at approximately EUR 350, including auctions. That number is a little bit smaller as of today because we have generated revenue over the last quarter I think what's worth mentioning is this backlog is all related to the years '21 to '24. So this is all before the sort of major uptick in the market, and it's a mix between upgraded vessels and vessels that's not upgraded. And the other table on this slide shows a little bit sort of on the magnitude of our tender activity at the moment. And I think it also very well illustrates the time lines. So '22 and '23, it's very little activity, not necessarily because there's little activity, but these jobs are already booked. For '24, there are a couple of projects we still intend to face. And then looking into '25, it's a huge bulk of work, which is tendered at the moment. And looking at '26, that doesn't say that the market is going down. It just says that those tender processes are not in full swing yet. So our focus at the moment is contracts for '24 and mostly '25. So how are we positioning in this market? We have, since the first quarter this year, we've been communicating that we have initiated an upgrade program for our fleet. So Bold Tern, she will be upgraded this winter and the others will follow, which means then our existing vessels will be on par with some of the newbuilds announced in terms of capacities. And we have also communicated that we are aiming to construct a fourth vessel to basically keep our market share and grow the company with the growth of the market. And then I would like to say a little bit more about the partnership with Shimizu. Shimizu is a large contractor in Japan. They have launched wind turbine installation vessel under construction, which will be completed late next year. And this partnership has come about because they have access to the Japanese market, and we know how to operate these vessels. So we fund each other on those terms. And basically, it means hurdles in wind carrier and our sister company Global Wind Service will be preferred suppliers to Shimizu in Japan for projects when additional vessel capacity is needed and also then Wind Carrier will market, the Shimizu vessel outside Japan. And given this growth program the company is certainly looking at financing solutions going forward. Just a short iteration about what we're doing to our vessels. I think the crane upgrades or crane replacements, which is more correctly, have been very well communicated. I think it's worth mentioning as well. We are upgrading the jacking system, which will give us increased variable deck load, which means we can carry more turbines, which is important. And to have the stability to do that, we're also installing sponsors on the vessel, and we are upgrading the accommodation area to welcome these wind turbine technicians. And then just to show some pictures of steel. The first upgrade is happening this winter. It's well underway on the crane fabrication. This fabrication of steel structures in the yard has started. Bold Tern is on route to yard and we do expect to be ready for first project in Q2 2022 -- early Q2. And then I would like to finish off with that people systems track record, client relationships and the execution capabilities is as important as the vessels. We have a picture from a project behind us that actually managed to end up in Ørsted's yearly report because of excellent execution from the Fred. Olsen Wind Carrier team. But this is important in this industry. And it's because we do very, very repetitive work, it's 50 to 100 turbines per wind farm and probably more in the future. So that can be a very painful magnifying glass if you do mistakes and don't have your execution in order. And this is done in harsh offshore conditions where wind, waves, currents and if you don't have wind, you might have fog. So you need to have plan this meticulously and you need the people that make the right decisions from this box. And I think that's the strength we have and we have the systems in place, we have the engineering capability in-house and we manage to do this with an excellent atrophy track record which we are vert proud of. So that concludes my comments.
Yes. Also thank you, Alexandra, for an excellent presentation. Then we can move on. Just a few words on Global Wind Service, another major operating company within this segment. They continued their good execution in this quarter a lot of offshore and onshore projects in Europe and -- but also most recently large projects in the U.S., where we have developed over the last 4 years, a very strong position in the U.S. Please move on. Then in the last operating company within the Wind Service segment is United Wind Logistics. The market for those vessels are strong. We have 1 vessel working in the spot market VestVind that is buoyant now and strong fleet utilization and also a positive market outlook for United Wind Logistics. That ends the Wind Service segment. Then moving into Cruise, and we can just move to slides, please. This one is more backdrop. But in the quarter, it's been a really active quarter also for our Cruise company. And it's been a lot of hurdles that they have been able to overcome to get Borealis into the water at the 5th of July. You can only imagine all the issues there have been around vaccines, around logistics connected with Brexit and so on, but the Cruise team have really worked, they are nice and able to mobilize Borealis in an excellent way and that resulted in the first place since the COVID pandemic out of Liverpool on the 5th of July. That was successfully executed. The ship was only having 50% occupancy. That's not because we could not have sold out the ship. There is a strong demand for cruises in the U.K., but is due to COVID-19 guidelines from the British Government until the pandemic is coming even more to an end. So what are the current plans going forward now, is that depending on that things doesn't go in the wrong direction again, that we will phase the ships into operation. The 3 other vessels and Bolette plan to start now sailing already from mid-August and then Balmoral and Braemar coming in towards the end of the year and next year. And the fleet will -- is planned to be utilized by summer next year. But of course, this is depending on that we have not just have 4 ships cruising around the U.K. It depends on that other countries are opening up for cruising and that we continue to overcome all these practical challenges caused by the pandemic. On the results side, we already covered that we have had the extra costs this quarter in connection with mobilization similar to the demobilization caused in second quarter last year and also sales and marketing related to getting the vessels back up. But maybe more importantly and we spent a little bit time on this last bullet point on this slide to give you also a more kind of long-term perspective what has really happened with Fred. Olsen Cruise Lines during the pandemic and how we see is now coming out of the pandemic. I think we utilized the COVID situation quite well to acquire Bolette and Borealis at favorable pricing and with favorable financing packages attached to it. In the middle of the COVID and also we're able to sell the 2 oldest and smaller -- 2 oldest cruise ships. By that, we not only increased the fleet capacity by approximately 25% and 1,000 passengers, but what we also see now when we have studied the vessels even more in detail, we see that the cabin mix is better than the ships we sold. That should give a higher yield. We see that the ships have large attractive public spaces and that we have now upgraded with both exterior and interior to fit the Fred. Olsen customers appreciate the line of style. I think these vessels, we -- I think we can -- of course, this is not a guarantee, but an expectation that based on the higher capacity, better yielding cabin mix, and the whole look and feel of the exterior and interior, it point to stronger earnings post-COVID than they have pre-COVID. And what we see that this is also then supported by a very strong demand for cruises while we get the fleet back into the water and the pandemic is coming to an end. So I will very much like also to end this part of the presentation before we go to Q&A on a little bit positive on the Cruise because they've really done an outstanding effort and the fleet is really well positioned now if things go back to normal. I think then we are at the end of what we plan to say and then we can maybe open up for Q&A.
[Operator Instructions] And we are taking our first question from the line of John Olaisen.
A couple of questions to the investigation into alternative financing opportunities, including an IPO of the Offshore Wind business. Could you tell us a little bit more about the potential -- or the timing of this? And also, what do you see? What's the financial need and maybe also a little bit more detail. In the case of an IPO, I presume Bonheur would remain the largest shareholder in such a company. Could you elaborate a little bit around these things, please?
I think probably you should answer, Richard, but just to say, I mean, this is certainly something that we are starting to work on now. So I think a lot of questions you are asking needs a bit of work internally before we come forward.
Yes. I can just supplement on that, our main focus now over the last months have really been to position ourselves in the best possible way in our home markets and also focusing on establishing the partnerships that we have announced and also we spend also considerable thinking true what should be included in this unit and also very importantly, how should the management of this unit to be in place. So we have now established all of that and established a strategy and a business plan for this, and now it's very natural to take the next step and lay out a more detailed implementation plans. But that's where we are. So I don't think we should go any further than that today before that is being further summed up John.
It's fair enough. And I give some color on it. Now on the comfortable tern this quarter, is it -- you said that it is on transits to yard now, we'll see the house for the rest of the year for the installation of the new crane. Is that correctly transited?
Yes. We will transit to a standard and straight yard for the upgrade on -- not on a crane, but also the other elements that Alexandra will explain about.
All right. And in this crane segment, could you remind us what you said about of the financing of the new build costs for it and then financing for it, please?
No. I think, John, we see some data points out there on new builds from some of the competitors. I think what is very more for us is what Alexandra had on our last slide is that we need to utilize our detail relationships with the customers and the detail knowledge from the sea fires and old engineers on all such future that still should be defined in detail. So we will not mark the contrast and compare to these other vessels because we need to utilize all our experience to design what we believe is the optimal vessel. And what that potentially will cost and how efficient that will be? We will need to revert to you about when that detailed work is done. So it's for us, it's too easy to kind of show of the number and comparing it due to on of the competitors.
Okay. Fair enough. My last question is just a detailed question. What actually the problem with the blades on the Högaliden, what was the issue actually on the blades?
Yes. I don't think we should go in detail on that, but I think Anette would comment.
I just see that there is a need for repair and certainly the supplier has taken that responsibility and is working on it. But it was meant that we have delayed on the wind part.
Okay. That's all from me. I'd like to just finish very congratulates to a great development, basically, all the segments over the last 12 months it is interesting to see. So thank you. Have a nice day.
Thank you for that John.
Yes. It could there have been done without very hard work across all companies. So I say thanks very much to our people.
Next question, please.
Yes. We are taking our next question from the line of Jonas Fleming.
Thank you for having me today and congrats on the results. So what is the reason for the great result in other investment segment?
Yes. I know that's the NHST. That has improved the result. I have to take -- also well done, if you go to NHST and look at their quarterly report there is a settlement in those numbers, a legal settlement that makes it maybe a little higher than you could expect going forward. So you have to maybe adjust for that.
Okay. So it's basically maybe one of them. But what do you expect for the upcoming quarters for the segment?
We don't guide for any of our segments. But I think you will find in the NHST quarterly report, there -- they have a separate reporting line for EBITDA before other items. So you can see the more underlying recurring EBITDA in NHST in their quarterly reports. So I think it's more efficient and prudent that I point you in that direction.
Okay. So I have one last question. Do you expect the capacity factors to be significantly better for the new onshore wind farms as Högaliden? Or do you expect them to be in line with the historical capacity factors?
Also a very good question. Högaliden will have a much higher capacity factor than the average. I think, if I recall correctly, that on a normal wind speed or normal wind resource, the megawatts will increase by approximately 15% to 16% by adding Högaliden, but expected production will increase by close to 19%, 20%. So it's a very high -- very good wind speeds in Högaliden because you're not with good wind resource, but there are also large turbines going higher up where there are stronger wind speeds. I think we have specified these numbers in the fourth quarter reports. You'll find them more specifically there. Next question, please.
We are having our next question from the line of Victor Smith Solvang.
Congrats on the great results. And I was wondering how do you look to reactivate the Cruise segment and how the trajectory towards recovery look like?
Well, I think it all depends on the development of COVID, of course. The U.K., which is our main market, has been hesitant in opening up for international cruising. And certainly, it very much depends on that. So presently, we are cruising in the U.K. waters. And hopefully, slowly and surely, we will be able to expand internationally.
Next question, please.
There are no further questions on the line. Please continue. Yes. We do have one other question from the line of Anders Roslund.
This carved-down segment Offshore Wind, it's a segment which is -- it could potentially be extremely capital heavy. And sort of venturing into offshore wind is a challenge for smaller companies without strong cash flows from other operations. How do you think about the difference between being a developer and being an owner and operator of offshore wind assets post construction? And how should we think about the way you think about it?
I think we can combine talking about that question, Richard. I think if you look at where we are in the Wind segment, we have been a developer, owner and operator onshore for many years now. So we have a lot of experience. The Codling Wind Park is a wind park we have worked on for many years. And certainly, you are quite right in your questioning, it is very capital intensive offshore -- building offshore wind parks. And that is also why we have now separated this out into a special business unit to get that focus and also to be able to look at various alternatives for financing. Do you like to add something in it?
No, I can just say that to be in the food value chain is very important, because cost and operational excellence is very key and we possess those skills. To just be a financial player in these markets I don't think really is an option. But having said that, what we see in offshore wind that we also see in onshore, which we have also utilized is that you can attract financial category down the road, which can help you finance your activities in a very solid way because it's a strong inflow of capital that really wants to invest into renewable energy and invest in partnerships with experienced operators like ourselves. And we have financial partners. We have industrial partners, and we have a long history of managing such partnerships in a very good way. So you don't necessarily need to own 100% post construction to have the experiences and track records and knowledge transfer that you need to be a successful offshore wind developer and asset owner over time.
Okay. I have a follow-up question as well. I'll let the follow-up on a different topic. I don't know if you have received a detailed report on the first cruise. It's just 9 days since it's commenced. But do you expect to see differences in the spend patterns from your customers, i.e., more onboard spending than what we have seen in the past? Are people -- you've talked about pent-up demand before and if we walk around in Oslo City, people are lining up to get into stores to get -- to be able to spend money. Is that something that you're seeing in the cruise operations as well? I appreciate it's only been 9 days, but so...
It's a very short time. But I think it's fair to say that presently, we are hoping that we will be able to come into different ports and have certainly the passengers that enjoy also onshore activity. I think, from what we have seen, the spending onboard is good, but it's really too early. People have to take it from there. I can tell you that we have worked a lot on making sure that the passengers are happy onboard are engaged. So hopefully, that will also click in spending.
Okay. Any more questions?
Yes, we have a question from the line of Jonas Chung.
Richard and Anette, I have another question on Cruises. You mentioned that due to this COVID-19 guidelines, you limited your occupancy to 50%. I was just wondering if that 50% threshold is kind of a limit, are you able to generate a positive margin on that utilization kind of level.
Yes, over time, it's not a satisfactory utilization, obviously. But it's miles apart from being in layup. So as long as we have our eyes that we'll get back into the waters, it's much better to get back short term in the waters at 50% than being in layup, and we -- this is a temporary measure from the U.K. government to kind of get experience and get into the water and not have the kind of any uncontrolled outbreak situation through the test systems and procedures. So we clearly see this as a temporary measure, but it depends. When will this temporary measure be lifted? It depends what Anette talked about on how the pandemic now evolves further. But over time, it's clearly way below what you can have a sufficient return on cruise ships on.
Yes. I understand. And just as a kind of an extension of that, do you think that you will be able to kind of compensate for somewhat lower kind of utilization levels with some higher ticket prices? Or have you seen the realized prices that you have seen so far at a higher than kind of pre-COVID levels?
Yes. If you look at our -- you can look at the Fred. Olsen Cruise Lines homepages and you can actually do it yourself if you want to compare the selling prices for the same type of cruise we're booking now compared to what we booked in '18 and '19 for '19 and '20 cruising, and you clearly see an uplift. And that is as it should be expected as we're coming in with 2 new ships now with larger cabin, more attractive public spaces, larger restaurants, totally modernized with the -- that you can feel that Fred. Olsen Cruise Lines customer segment will appreciate. So we see that is reflected in both the pricing and bookings. And that's why we also pointed that we expect higher EBITDA when we are back into the waters with the 4 ships that we have pre-COVID. Next question, please.
Next question comes from the line of Victor Smith Solvang.
With regards to the crane replacements, how much CapEx is left on Bold Tern?
Yes. We haven't disclosed that in detail. So it would not be prudent to kind of disclose that now without doing it broadly. So sorry about that. Next question, please.
There are no further questions on the line. Please continue.
So I think we will just wish everybody a very nice summer, and thank you for joining us.