Odfjell Drilling Ltd

OSE:ODL

Earnings Call Transcript 2020-Q1

[Operator]

Good day, and welcome to the Odfjell Drilling Q1 2020 Investor Call. At this time, I would like to turn the conference over to Eirik Knudsen. Please go ahead, sir.

[Eirik Knudsen, VP of Corporate Finance & Investor Relations]

Thank you so much. Welcome to this investor conference call for Odfjell Drilling, where we will present the 2020 first quarter results. We hope everyone is keeping well in these special times.My name is Eirik Knudsen, I'm Head of Investor Relations in Odfjell Drilling. And usually, I have with me Simen Lieungh, our CEO; and Atle Sæbø, CFO. As usual, Simen will cover the first part, and Atle will thereafter go through the financials before we conclude with a Q&A session at the end.For the sake of good order, we'll make reference to our disclaimer on Page 2 of the presentation. I will then leave the word to Simen. Please go ahead.

[Simen Lieungh, CEO & President]

Okay. Thank you, Eirik. Good afternoon, everybody, and thank you for calling into this Q1 conference call. We'll follow the same principle as earlier. I'll go through an operational part, the markets, certain things there. A lot of comments around it today. And Atle will take over on the financial details. And as we said, we have a Q&A session at the end of the presentation. We have a presentation and you probably have that. So I will refer to the pages. We'll then go through it and take it from there.So this is Page 3, so I'm skipping over to Page 4. This is a very quick summary of the company. We have a quarter or the financial for Q1 '20, we have close to $200 million of revenue. We have an EBITDA of $82 million, and Atle will give more details later. We have a good cash position, about $174 million. And the leverage ratio is coming down and it's currently less than 4, it's 3.75x.The backlog currently including some options is $2.2 billion. Just mark that this is not including OWS, Well services, neither with the technology department we have. So the focus going forward in this picture will be clearly, as earlier, that we will work hard now to strengthen that position, to maintain the backlog and improve that and improve and maintain our cash position that's core going forward. So that's going to be the company's priorities. We have the same structure with mobile units, more into that later, and Well services, Platform Drilling and Technology. So that's a quick sum up of the company.On Page #5, some key summaries for this year. Of course, we are all quite impacted, all of us, about the COVID-19 outbreak. This is, of course, need to be addressed. Currently, there has been limited impacts at our operations and financials. We have been able to keep our operating fleet, our projects, our operations. Onshore support is still the same, so very limited impact or nothing.We -- of course, we follow all guidances from our government and health authorities, both national here in Norway and international. We have very few examples of infected employees. We do have some that are very few and they seems to be under control. We have been able to arrange for systems and controls to operate and do crew change and keep operations impact.Of course, what is a big question mark is what's going to happen going forward. We do not have any better view than anybody else that this pandemic seem to be more under control that we have -- but I have to kind of remind everybody that our Minister of Health in Norway said that similar to Churchill, he said that we might see the end of the beginning.So we need to be aware and need to follow the strict rules and restrictions. We already are following to try to bring this under control as soon as possible, and that goes for everybody. And that might be the big, big challenge.We have a strong backlog on our fleet, which is, of course, the most exposed, I would say, both positive and negative in the company. That is actually 85% approximately of the balance sheet. And -- but the 6 gen harsh environment fleet has a good backlog. And we do have currently very, very strong operations. We do have some interesting prospects also. We're looking forward to hopefully complete and build, and as I said, strengthen our backlog going forward.So we have just completed the SPS with Deepsea Aberdeen. Deepsea Aberdeen is now back -- will be back in operation, I'll come back to that a little later. The performance across the MODU fleet is strong as we see the same within Well Services and Technology. So even though those numbers are not that significant in the complete bottom line, we are very pleased to see that we have a very strong Q1 overall of this company. I'll come more back to the market outlook and the clients' behavior when we -- some of the market, in general, a little later.On the Page #6, where we see MODU, we do have a high-performance uptime, financial uptime continuously. The lower uptime with Aberdeen is linked to the SPS, which I mentioned, that took less -- little less than 3 weeks. And totally, and we kept the budget. So we are starting to have kind of -- getting quite good group on the controls of SPS because that's quite significant and heavy operations. But this went fine, like we did with the Atlantic earlier. So I know we are currently working with SPS on the Deepsea Stavanger.Bergen has now been at a key site for some time after the contract, as you know. What's going to happen with Bergen is relatively uncertain. We do have some comments on that later, but we still try to keep the rig operation in total. So I'll come back to that a little later. But in general, we are very pleased with the operations. MODU is a strong provider of quality, safety and efficiency, and that has been reflected strongly by our clients. So very, very happy to see what we have achieved, and there's no reason we should not do that in the future very soon. And thank you for that.Looking at the #7, where we do have the overview. So Bergen is now at the key side of CCB. We have an upcoming SPS later this year. We all say that Deepsea Bergen has been a very strong workhorse for many years, built back in '83. We have kept the rig warm and operating through the full -- continuously through the crisis, starting up in '15. We have ended the operations now in early '20. And we are now looking what to do with the rate.We are following several leads. Of course, an SPS takes significant investments. This -- Bergen is not a young rig anymore. And then the demand for the stacked kind of rigs are more limited. Clients wants more in new assets. And Deepsea Bergen is not the new one, so it's not that attractive. However, we are looking at several opportunities, what we can do here. So if we are able to build a stream of work to substantiate an SPS investment, that could be part SPS or full SPS. So we keep all options open and have opened that quite many times saying that there are several alternatives. We can do the SPS fully based on the backlog. We can do it partly on a more limited backlog. We can sell them, we can scrap the rig, we can cold stack the rig. So they are warm stacked rig. There's a lot of options that we have not decided what to do. So we treat that open. And of course, but in this situation with the COVID-19 impact, it's not easier, as you all understand, but it's still some, tall sector that we are looking for. But we cannot say what's going to happen.Deepsea Atlantic has on the MFA with Equinor. They continue to work on the MFA. They had a very, very strong performance of the Barents Sea. I think nobody has seen anything like it ever comparing with efficiency and safety and accuracy. We got very good feedback from our clients and the cooperation we have there with Equinor and Beacon. I'd like to emphasize, that has been extremely successful. And of course, we do have some basic day rates there, but we also have earning points when we do the work right, and we have our bonuses up there. So that's very nice. We share that with our partners.So this contract brings us to the Q1 next year, and we are continuing to talk to Equinor, of course, with the hope to continue on the MFA. The good thing is Atlantic is prioritized for production and not exploration drilling, so production is more stable, and we benefit from that part because that's what the client wants, and that's where we want to -- where we want it. So let's see what happens.Deepsea Stavanger is now a key side of the tunnel. We are just -- we dry docked the rig for the first time. It's not a common site to look at the sixth gen semisubmersible harsh environment in the dry dock, but we did that to prepare for the operation in South Africa. We have -- due to the situation we covered by team and the closed shutdown in South Africa, we are still talking to Total to find a way to wait until we do the final mobilization. We are now in the process of agreeing some sort of a standby period and keep the rig ready for mobilizing when things might change south. So we will probably come back to the details when we have finally agreed it, but the rig is now close to being ready for the after modification, and then -- and the maintenance of the structure. And then we have listed on the third-party equipment, we are, in general, ready to go. But how long we will wait remains to be seen based on the development in South Africa.The Deepsea Aberdeen was -- has a 7-year contract. That project ends in late April '22. In this market, we have to say, it's a good contract. It has terms and conditions, which is okay. We have had a short standby period in the U.K. because we had to wait for some equipment for continuing for the BP, but that has developed, and we are now want to move the rig back to the offshore location. And we will start drilling -- expected to start drilling now again in late May this month. And we will then continue under the current contract of the fleet called Quad 204. So that's the situation there.Nordkapp has a 3-year contract with Aker BP ending in June '22. We have one last option in the contract, which has a call later this year, early next year. And currently, after Stavanger left Aker BP's program for South Africa, Aker BP is now ramping up more work for Nordkapp. Nordkapp has shown to be a very efficient rig. We are very pleased to see that the investment we did and the modification we did really pays off. And we have high expectations that the rig is going to be a workhorse, similar to the other sixth gen we have.So that is okay, and the program for Aker BP is more or less settled. And again, it is very much linked to production drilling, which is, of course, positive because that means cash flow for our clients.Deepsea Yantai is on management for Neptun and CIMC. The rig works fine, and we are pleased to say that, that concept was not really known to us, but we have learned it to operate. And we see that there's a huge potential for improving efficiency there. So I think that I can say from behalf of the Neptun organization, they're very pleased. And we expect that the program for Yantai will be extended over the next half full year.So the backlog for MODU is about $1 billion.I move over to Platform Drilling & Technology on Page 8. It's nothing really much to say. We are -- we do have a long program for -- with Equinor projects. We have a situation with Brage for Wintershall -- has been that Wintershall has decided to put the rig of the program at so-called Phase 3, meaning that there are some sort of a standby and reduce activity. It is due to the lower oil price. So that's not really okay, but we have to have that, too. So that's a minor impact. They might do some temporary layoffs, and we have done that. But we hope that, that will not last too long.ConocoPhillips has decided to operate 2 springs and both X and [indiscernible] will start in June, July, respectively, August, and that means that the dropout of Brage will be compensated by the ramp-up of ConocoPhillips. And that is -- that's the process which also is under control, and we are prepared to ramp at that point.In the U.K., we operate Clair Ridge for BP. We are in the process of developing an alliance with BP, which is the first alliance BP have done ever. That's experiment we like to go, that means that we will be closer to the operations. We will be closer to the planning, and we will have much more predictability on the operations, and BP is a very, very important client for us, of course. And Clair Ridge is a very important project for BP. They have clearly indicated, they will not stop any operations there. We are totally in the portfolio of these fields to see on the personal rate, we have no hiccups or stops due to the COVID-19, touch wood.So it has been very good handled.We operate for TAQA. They have 4 platforms. 3 of them are standby, and 1 of them is operating, and we are now -- continue to work for TAQA on that part in the U.K.Okay. Well Services on Page #9. Again, it's the same structure. We do have several services to offer, Tubular Running, Casing While Drilling. We have Well Intervention and we have Rentals.Casing While Drilling has been -- is a joint venture with Huisman. And I hope that we, not too far into the future, can announce that we have done -- we hope will get some activity on that part because that is an interesting way of doing wells completion. And we have tested equipment. We have had some failures. We have learned from that, but we are in a position now to mobilize that kind of equipment. And hopefully, we'll -- not too far into the future, we can announce a contract or 2 in that direction. In general, if we look at the market there, I have to say that we have seen drops in the operations due to because -- due to COVID-19 shutdowns. We operate in more than 20 countries. We are in Continental Europe. We are in the Middle East. We are in Asia Pacific. We are East Europe, West Europe. We are U.K. We are Norway, of course. And there has been, for example, Romania, which is a huge market for onshore drilling, and we have quite big organization down there. The Romanian market with OMV and petrols shut down in March and April and that was full stop, of course, because of the COVID-19. That hits our operations. But we have been able to -- just to maintain the people, and we are now ramping up again because they opened the country. We see that all over place. Also in the Middle East, where we have quite good operations in Kuwait and Qatar, whilst Abu Dhabi has been slowdown, but it doesn't really -- it's not a big contribution to both either revenue or bottom line. So we see that even though we have taken down the -- our forecast somewhat in that aspect to see what kind of effect we have based on the COVID-19. We actually see now that slowly things come back to operations again. And the way we have structured our services is attractive, and client wants us back. So I think we can get too close that the company has raised itself quite elegant and are still in place to commit what clients offers to be resolved. From being various working [indiscernible] certain anymore. And I think that the numbers we will provide will be, I would say, okay, not super, but nothing is super these days. But okay or more.If we look at the Page #10, we do have the backlog. I think that this is really a key here. What is important in a crisis. Well, we will focus on the all good stuff, cash flow, liquidity and backlog and cost discipline. That is the recipe we have used before. This is the recipe we'll use again. Atle will go back -- come back to you on how we deal with our stakeholders and banks and financial supporters. But we are quite focused now to make sure we keep our rigs working, that we win the right work like we did when the last crisis hit and a lot of questions and comments about that.But the good thing, this time, we have over the last years proven that we have probably the most efficient harsh environment fleet in the world. Of course, that makes it very attractive. So having said that, we believe that this backlog will, at least, be maintained or maybe even improved.Market, market. Well, I get a lot of questions about this. And how do you foresee what's coming? Of course, oil companies reduce their spending and they push programs ahead of them. And the oil price, as we know, have dropped significantly from $70, $80, down to $25, $30, and it seems to be stabilized. We didn't actually need that war on oil price on top of the COVID-19, with the -- that cost service really poisoned. But now it seems to be that the organizations has found a way through this. And even though it's going to be a very tough 2021, we actually believe -- and this is not kind of me thinking by myself. It's how we talk to our clients, how they view the market, how they view their spending, how they view their production, how they view their decline in production without doing anything. So yes, there has been -- the same argument is coming up every time. But clearly, the major oil companies we work with and others they, of course, have to monitor and make sure they are not kind of stopping all investments because of this incident. Then they see the need for energy and oil and gas going forward is very much the same. So the day the COVID-19 pandemic is more under control, and when that happens, well, none of us know. But of course, it has to do with countries open up again. It has to do with people starting to move again. It has to do with industry start to operate again and so forth. And we have shown that even though this pandemic has been -- has hit hard all countries. I mean, the unemployment in other countries is increasing significantly. There are ways back to the more like the normal or what's going to be the new normal. So I think that -- we think that this slowdown will be tough in the next 1 to 1.5 year. But we also see that if -- and if is really when this pandemic get more under control with vaccines that are definitely more handable. If that happens, we see a significant bounce back in the market.So with MODU, we see that we are, of course, we have to accept that the 4,000 day rates half a year ago will not happen. We don't see it coming up to 320, 400 in '21. We don't see that. It's going to be lower. It's going to be lower in '21. Contracts today are under pressure. We have no, let me say, negotiations of our current contracts. No, they have been honored. But we see that when we do the next wave of operations in '21 under the alliances and frame agreements, of course, the pricing is under pressure. So from the indicative areas, which we all view half a year ago, we are lower. We can come back to more detail if somebody more into -- in more detail. But how we will think going forward, we will -- we are willing to discuss the day rates, but we're also willing to improve our bonus schemes because we have shown that the performance, in general, of the whole fleet is very efficient. And the clients are -- so we look at the absolute number, the gross day rate they get. That's a combination of fixed day rate and the earnings via incentives. So I'm not really too concerned about the each one of them, I look at the total. And if that plays together right, we're okay. So we're okay with that.We believe scrapping will continue. And if I look at the market or in-house environment, there are too much supply to achieve and there are -- we should be more disciplined to everybody to take out capacity. And we're not exposed to deepwater arrangements anymore or jackups. But deepwater, pacific water, and benign waters are really, really exposed. And we hope, and we believe there's going to be more scrapping also in new assets. That will be good, but we'll never ever operate. It's tragic, but its progress, too.So yes, offshore markets, it will still be very competitive compared to [indiscernible]. The restructuring we are going through and still are going through, we'll show that we are -- we will keep our cost discipline and keep the operations efficient and be very well positioned for competing with Shell, which is today, dropped significant, especially in the U.S. and probably will stay low for longer, which means that, that production plus the Odfjell productions will incentivize the oil price to come up again. Well Services, again, we see that from stopping through -- stop many markets from especially March and April, we are seeing a slow ramp-up again. And as I said, within the next 12 months, we see that the expectations will be that the market will come up again. And hopefully, we can harvest from that part.From Platform Drilling and Technology, it's a very stable market. And in the bottom line in this country, it doesn't count that much. But for us, both of these areas are quite important because it creates total supply of services, and we have good add-on selling when we do operations on typical platforms. And there seems to be no platforms except for Brage, we expect to be put on hold. All the other platforms are working, and our clients has confirmed that these platforms, 15 in number, will still operate even though the market -- the oil prices is low, which means that this is also a good platform literally spoken for drill services that service all the platform of bottom [indiscernible] and then we do some casing and running. And casing -- [indiscernible] clean up, we serve those services' overall platforms. So that's a good synergy in it all.This -- it's due from my side, and we'll probably questions later, but I think Atle, you can take us through the financials.

[Atle Sæbø, CFO & Executive VP]

Thank you, Simen. I'm pleased to take you through the first quarter 2020 group financials. The group operating revenue was $197 million compared to $201 million in first quarter '19. The group EBITDA was $82 million compared to $73 million in the same quarter last year. The increase in EBITDA is reflected by increased EBITDA contribution from all segments. Further comments will be given when we move over to the segment financials.The EBITDA margin was 42% compared to 36% in first quarter '19. These were the blend figures of the capital-intensive MODU business and the unit capital-intensive Platform Drilling & Technology.Let's take a look at each of the business segments, and we move over to Page 14 and start with the MODU segment. Please note that as of January 1, 2020, the internal reporting of the segment is prepared according to IFRS. Comparative figures are also adjusted accordingly. The operating revenue for the MODU segment was $142 million compared to $152 million in first quarter '19. The EBITDA was $70 million compared to $67 million in the same quarter last year. The change in EBITDA is mainly due to the operation of Deepsea Nordkapp, partly offset by less EBITDA from Deepsea Aberdeen due to SPS activities and Deepsea Stavanger as Q1 '19, EBITDA was strongly impacted by the bonus payment by Total South Africa. We have further received performance bonus of approximately $3 million this quarter. The EBITDA margin was 49% compared to 44% in first quarter '19.We then move over to Page 15, the Drilling & Technology segment. The operating revenue was $36 million compared to $34 million in the first quarter '19. EBITDA was $3 million compared to $2 million in the first quarter '19. The Drilling & Technology segment continues to perform very well, and we are delivering an EBITDA margin in the area as expected for this business. The EBITDA margin was 7.3% in the period compared to 6.1% in same period last year.If you then move to Page 16, the Well Services segment. We can see that the operating revenue was $28 million compared to $25 million in Q1 '19. EBITDA was $9 million compared to $5 million in Q1 '19. Despite the challenging quarter, Well Services has delivered solid in first quarter '20. Increased activity in Norway is the major contributor, along with improved margins in Europe, in general. The EBITDA margin was increased to 31%, compared to 20% in first quarter last year.If we then move to Page 17. On this slide, we have shown the bridge from some EBIT of the segments due to group consolidated profit before tax by adjusting for eliminations, corporate overhead and net financial items.Then we move on to Page 18, the summary statement of financial position. We can here see that the group's gross interest-bearing debt was $1.39 billion at the end of first quarter 2020. We had $174 million in cash and cash equivalents at the same time. And the equity ratio is 40% by end of the first quarter this year.If we then move to Page 19, the summary statement of cash flow, we can see that the net cash from operation was $43 million this year compared to $36 million in first quarter '19. The investing activities is $23 million in first quarter '20, and this is mainly related to the SPS of Deepsea Aberdeen. We repaid $28 million in bank debt and utilized a credit facility amounting to $25 million in the first quarter '20. The cash position as per end of March, was $174 million, same level as per year-end '19.If we then move over to Page 20, which is the summary of first quarter 2020. If we start with the mobile drilling units, we can see that we have attractive harsh environment assets, we have a strong backlog and healthy outlook despite the COVID-19 and the negative shift in oil price, in general.The Drilling & Technology has delivered solid operations combined with healthy financial results. We are preparing to commence operation with ConocoPhillips on Ekofisk from third quarter this year.Well Services continued its strong activity, although the service market has been affected by less demand due to COVID-19 and the oil price turbulence in the market.If we then try to summarize our financial positions, we have a good earnings visibility, grew $2.2 billion order backlog. We have a sound cash position. We have a strong balance sheet combined with continued deleveraging of the company, and we are now short-term refinancing requirements coming up. The first one is in the third -- fourth quarter of 2021.So this were the summary for first quarter 2020. And this concludes our presentation, and we would now like to open for Q&A session.So please, if you have any questions, comments, we are available.

[Operator]

[Operator Instructions] Our first question will come from Lukas Daul with ABG.

[Lukas Daul, Analyst]

Quick question on the Deepsea Stavanger, Simen. While it's waiting for the mobilization to South Africa, what is the sort of economical arrangement that you have in place with Total? You, sort of, indicated that you have to wait until they give you a goal. So are you on a standby rate? And how is it working?

[Simen Lieungh, CEO & President]

I cannot give you the exact numbers for decreases at least to me. But we have -- it's a little uncertain how long this waiting period will be. So we have a contract arrangement. But I'm not saying that we have agreed that it could be a potential period going forward. And how long that potential period really depends on how we organize ourselves regarding how restructuring and all the costs we have in the rig. So I call it a standby period. But the compensation will be somewhat kind of a special standard rate that if we're able to cut down the costs, we will be compensated. So the impact of the waiting period, but not shift our financials significantly.So it is -- the rig shall be kept warm, the rig shall be kept ready to mobilize. And if we have to do some temporary layoffs. So clearly if the thing drags out, we will reduce the cost at the same level.So -- but at the same time, we have to be able to mobilize within a quick notice, maybe just a week or 2. So it's not really a significant change according to what we can expect in a normal standby period. But it's a special standby arrangement, which we have agreed with Total for a quick mobilization as possible and be prepared.So we won't hit the bottom line very much. But we will met the expected income of the contract when that finally starts into mostly '21, I guess. It's [indiscernible], so that's the key.

[Lukas Daul, Analyst]

Okay. So you are safely sort of covering your cost while you're waiting? I think that's fair.

[Simen Lieungh, CEO & President]

Yes. That's exactly right.

[Lukas Daul, Analyst]

Okay. And then you kind of invited to the discussion about the day rate environment. So I'll take you up on that. If you could provide some more color or any your thoughts? It's always interesting.

[Simen Lieungh, CEO & President]

Yes. I wanted us to talk -- I wanted when I expected you to ask [indiscernible] before you asked. So now day rates, I think we will see that I get to be quite -- when we saw 356 to 70, I think we can reduce that in the 50,000, at least, that's my view. That's in the '21 era. I don't think you should expect that too many contracts in the harsh environment. I mean, I don't talk about them, because we see nothing. So I guess that you will see numbers -- base numbers around 300-ish area, maybe a little lower, maybe a little higher. But we will -- as I said, I look at the gross number, and the gross is incentive and the incentives can be quite significant. And when that happens, you will see at the bottom line. But I don't think you will expect that we'll negotiate contracts in '21 and we hit 375. It's not going to happen in my book. So be realistic and be at 300 plus/minus. That's the area.

[Lukas Daul, Analyst]

That's a good color. And then on the Well Services, I mean, it started to pick up a little bit. You've done a good job on the costs and sort of improving the margin. Now we get this setback, how do you sort of see it playing out? Are we going to go back to where we were when things were trusting? Or have you sort of been able to scale down the op so that the EBITDA and the margin may stay a little bit better?

[Simen Lieungh, CEO & President]

We are -- we do not compare to our -- we do not guide anything. We more like talk about what we see in the future because if we started guiding, you just roll itself into a different soup. We don't do that. But we see that Well Services isolated, is performing relatively okay. Of course, we have been hit now a couple of months with COVID impact, meaning that things have just stopped overnight, but those stops is now started up again. So 2 months of drawdown is not -- will not kill the performance in the organization.Now we have been able to -- accordingly, been able to take down costs in similar situations. And so I don't think we will see too bad the development of the area. I will not guide on numbers but it would be -- to us, it's acceptable. We understand that there will be a margin, we have to be tough. We see May, June coming up. And if this continues, I mean, if the COVID-19 bounced back, and nobody knows about that. That starts up again being like we had early March. Everybody go home again and stop everything. Of course, is going to hit absolutely, but we don't think that's going to happen. If the world stays disciplined on the restrictions given by the government and the health authorities. So if we just hope that's going to be some sort of a ramp up again is not going to be too bad. But I can't give you numbers.

[Lukas Daul, Analyst]

Sure, sure. That's fair. And you've got refinancing coming up in the end of '21. Have you sort of start looking at the possibilities there? Or is it too early and you've been busy with other things, which would be understandable?

[Atle Sæbø, CFO & Executive VP]

No. We haven't started that process yet. We probably start that in second, third quarter next year. This is by end of 2021. And we have 2 facilities coming up for refinancing. That's the Deepsea Aberdeen, which already wear a loan of $530 million. Now when it's coming up for refinancing, it's less than $200 million, what's for refinancing. We also have the service activity which started out $450 million, which will be $150 million for refinancing well over by next lockdown. So if you see this in combination with the deleveraging of $200 million on a yearly basis, on a group basis, we think this absolutely should be durable. Of course, the market is now -- is difficult. But we also think that something will happen within the next 18 months, both within the market and within the financing market. So we are okay with these 2 refinancing coming out.

[Operator]

[Operator Instructions] I am not showing any further questions in the queue at this time.[Operator Instructions]Mr. Knudsen, I'm not showing any further questions in the queue at this time.

[Eirik Knudsen, VP of Corporate Finance & Investor Relations]

Okay. Thank you so much then for calling in. And I hope everybody continues to stay safe and have a nice afternoon.

[Atle Sæbø, CFO & Executive VP]

Okay. Thank you, everybody.

[Operator]

Thank you, ladies and gentlemen. This concludes today's teleconference. You may now disconnect.