Wallenius Wilhelmsen Aktie

Good morning, good evening and good afternoon to everyone watching us online, and a very warm welcome and good morning to everyone here in the audience.

Q1 2026, what can we expect today, Anders?

Well, there has been some geopolitical turmoil. So I think we'll hear about the impacts from that.

Good. And as usual, our CEO, Lasse Kristoffersen, will take the market and the business, followed by our CFO, Bjornar Bukholm, who will take the financial review and then Lasse will take the prospects. And as usual, the Q&A.

Q&A. So we'll open for Q&A here in the audience, but we'll also open up for Q&A via our webcast. So please fill in your questions and we'll try to respond to them as best as we can.

And do remember, there might be a little bit of a lag between when you post the questions and when they arrive here, even in a digital age. So please be patient. And we'll try to respond to all of them.

And I think we're ready.

Yes, we're ready.

Good. So Lasse, please take it away.

Thank you, Anders and Anette and good morning. Welcome to people in the audience and online. And I can see we have both friends and family and partners in the room. Thank you and welcome.

When I stood here in front of you and where we were online last time was on February 11th. And when we looked at the future, we thought it was pretty good. And again, we made a mistake of thinking it's linear. And then on February 28, there was an escalation of the situation in the Middle East with an attack on Iran, affecting both business but certainly oil markets.

And what we have seen in this quarter is really -- and when we are now updating our full year expectation is pretty much effects of that event. Because if we go back 1 or 2 years and you would ask anyone, I think, in our industry, probably us included if we saw somewhat weaker Q1 2026, why would that be? All would say because there are too many vessels, the market will be softer and the demand will be softer. That is not the case.

We are very positively surprised by the demand. We are sold out. As you will see, our activity in the logistics area is picking up. So the reason why we are adjusting our forecast somewhat is purely because we see a different cost situation, of which we believe we will recoup most of the cost over time.

So I want to start with saying very clear that we are positively surprised by the strength and the demand in the market. And as you will see later, this is very much driven by the enormous success of Chinese exports.

So let's then jump to the highlights. For Q1, we delivered an EBITDA or adjusted EBITDA more precisely of $389 million. That's down 3% quarter-on-quarter. And given the global events that we believe that is a relatively minor softening quarter-on-quarter. And it is in the shipping area that we have seen higher costs, while we have seen improved performance in logistics.

And I just want to reiterate the demand, the utilization, the tightness in the shipping market is very, very high. We are sold out. And we need to say no to business as we speak. This has put pressure on the charter rates meaning that it's much tougher to get access to more tonnage, more capacity and prices have increased.

We have, for a while, worked with improving the performance of logistics. I'm very proud of what the team has done last year, but also into this year. And the Q1 improvement is partly due to better volumes, but also because we have been better at managing our costs and really implemented measures, so that we have a good and well-adjusted cost base.

The impact directly to us from the Middle East conflict and I'll come back to some more numbers, is rather limited. So the indirect effect is what hits us. And that is through the oil price and through that, the fuel price.

And we have only seen the start of that. So we expect Q2 to be substantially affected by increased fuel costs. Bjornar will come back to explain to you exactly how that works. But in over time, we are recouping our fuel price.

So if the fuel price goes up, our earnings goes up, but with a lag. And what we are saying is that within Q2 and maybe also within 2026, we will not be able to recoup that increased fuel cost fully. But over time, we do recoup it. So this is more of a prioritization.

Due to that, we have adjusted our full year outlook. We now believe that, that will be about $1.6 billion. And I will then add still being a very, very strong result and cash flow for our company, putting us in a very strong position for future growth and development.

So all in all, we believe another solid quarter. And we still believe a very solid year for Wallenius Wilhelmsen.

And I'll tell you a little bit of why. Starting with the Middle East. In everything we do, we start with safety. Also with the Middle East and we're happy to report that we have one vessel, not happy that the vessel is there, but happy to report that the people are safe. Of course, it's not a good situation to be in, but they are safe, they feel safe.

And also, we have an operation with logistics in the Middle East that also they, given the circumstances, feel and are safe. We have normally 2 monthly sailings into the region. And we have a -- in shipping and we have a processing center and a logistics operation in Dubai. All in all, maybe 2% of our revenue in shipping annually is linked to the Middle East. And this is fully replaced by other volumes and revenues from other trades.

So the direct impact from the demand into the Middle East is not really hitting us. So our exposure is more or less $2 million of revenues on our logistics per month. Right now there's hardly any equipment moving or vehicles moving in the area meaning that we are seeing negative numbers on our logistics operation. But our focus now is to make sure that our people are safe.

So then to the market. And I'd like to talk to you about 3 things. One, the Middle East and how does that affect our market. Again, and as always, and I probably will do for many quarters to come, talking about China. And then also on the shipping market and the tightness of tonnage.

Starting with the Middle East. If you look at the left, the total sales -- the global total sales is around 90 million cars. Out of those, roughly 3 million are sold in the Middle East. So 3% of the global sales are in the Middle East. However, if you don't look at Iran, where they are producing cars for themselves, the region is importing their cars.

So even though it's only 3% of the volumes, it's actually 10% of the global demand for shipping. Where of Saudi Arabia is by far the biggest, you have UAE, Kuwait and these are new cars. And then in addition to that, the Middle East is a major hub for used cars, traded used cars coming in from both from Asia and from the West and typically transloaded and sent to more developing markets from the Middle East.

So the Middle East has an impact on the total volumes in the market. So despite the fact that 10-plus percent of the demand in the market has more or less disappeared, it's still super tight.

If you look at the players, we are a relatively small player in the area. We have put up on the left-hand side there our peers on a no-name basis. And as you can see, of the total transit in Hormuz last year for RoRo vessels, we had 4%, so we are not a big player in the region.

Right now there is no trade going into the region. We can neither get our vessels out. There was one vessel reported going out yesterday on a very special circumstances, but we are still in there.

So if you are to feed this market, which happens now, you need to go all the way around Africa through the Mediterranean down Suez and to Jeddah or possibly Akava, adding a lot of demand to shipping. So the main effect for us has been on the fuel.

And as you can see, we had a spike in fuel prices following the incident, not very dissimilar to what happened with the invasion of Russia into Ukraine. The big difference is that the spread between the heavy fuel oils, the VLSFO, very -- the low sulfur fuel oil that we use and the distillates being the marine gas oil and diesel oil has gone out tremendously meaning that Middle East is important for oil and heavy products, but even more important for distillates.

And that's why you see concerns on diesel and petrol for other industries because these are really much more tight than the fuel we use. So when we came into March, we were worried whether we would get access to enough fuel. That risk is now significantly reduced. And right now we believe that there will be enough supply also in Asia of heavy fuel oil although we see some limitations on the distillates in the marine gas oil and marine diesel oil area, but we can manage with that.

So generally speaking, this is a pricing issue, not an availability issue. And as Bjornar will come back to, for us, it's not an absolute earnings problem. It's a prioritization of earnings issue.

Then to China. And we need to brag a little bit. So last time you were here, I think maybe 2 meetings ago, we said that the world or the forecasters get it wrong. The expectation was that China growth would slow down.

We talked to our customers. We looked into what they said and what their plans were. We looked at what they actually gave us our bookings. And for once, we were right.

And that means that the growth is continuing maybe with increased speed. And this year, we would most likely see closer to, I mean, around 8 million cars compared to some 6 million cars in 2025 exported out of the region. And that goes also supported by strong volumes out of the rest of Asia, marginally growing, doesn't look here, but it's marginally growing if you add Korea and Japan together.

So their push out of Asia is enormous. And the trend, unfortunately, out of the West also continues to soften. So the imbalance and I'll come back to that in the market, is still an issue for us.

But the demand is strong. And remember, for every single car or vessel load added out of China, you need a vessel because this is -- there are no volumes that match that on the other side. So there's a full round trip.

So if you have 5,000 cars that need to go to South America, 1 vessel to South America, empty back and it really takes a lot of capacity. And just to qualify these experts, as I said, if you take away the U.S., Chinese cars and Chinese equipment goes to all over the world. They're growing in more or less all markets and in all segments.

So for those who believe that the Chinese story is about electrical vehicles, that's not right. And there, they roughly told, 1/3 of what they sell are normal cars, ICE cars, then they have hybrids and then they have EVs. So they are succeeding in all parts of the auto industry and in all parts of the world. And we believe they will put another record this year.

And underlying this, we also see that slowly but steadily volumes are moving from containers and other segments into RoRo because when the volumes really become big, they need a more efficient and better logistics solutions. And with big volumes, as we have seen in Korea, as we have seen in Japan, nothing beats RoRo.

In Europe, we can see this country by country that the Chinese market shares are growing and they're growing fast. And only from Q1 last year to Q1 '26, we have seen more or less 50% growth in market share. Roughly '25 over '24 was a doubling of market share of the Chinese cars. So we believe that this story has just started. It's certainly not ending anytime soon.

We also have High and Heavy this quarter, around 25% of our volumes and that picture is more mixed. In the construction area, if you look all over the world on the more residential typical housing, it's still soft or flattish. But we see quite strong demand in parts of the world, in particular in the U.S. on infrastructure construction and this is very much related to the new data centers.

And it sounds crazy that one thing can drive the whole market, but it actually does in all parts of it. And we see that what we now see from our customers, both Western and Eastern based, is that they are increasing their bookings for the rest of the year.

Mining has been strong, continue to be strong and investments are keeping up while the situation in the agricultural industry really has become, if possible, worse. They have seen low commodity prices for a while.

And now that is matched with increasing costs on fuel and on fertilizer. So we don't expect the demand for equipment in the agriculture industry to turn anytime soon.

But all in all, we see an uptick in volumes and increased projections from our customers in the High and Heavy area. And as you would remember, these are companies like John Deere and Caterpillar and Komatsu and Volvo and construction equipment, agricultural equipment and mining equipment producers around the world.

Thirdly, what really drives the market now is that there are too few vessels despite the fact that the fleet has grown from 4 million to 5 million units in capacity, meaning 25% growth in 2 years gone. The growth coming into 2026 and the capacity coming into '26, more or less already taken.

So the market is still super tight. And we saw -- we were right 2 years ago that we thought market would soften. But we did not think that we will see the strength we are seeing today.

And since late last year, early this year, we have actually seen an uptick in time charter rates meaning that there are still less vessels than there are demand for vessels in our segment. And that is something we expect to continue throughout this year because there are hardly any vessels available.

And then, of course, there are always opportunities. And we have some very good and deep partners that we are working with long term. And we're able to secure what we need. But for sure, the market is what the market is and that is currently strengthening.

So all in all, when we summarize the market, what we thought maybe 2 years ago about 2026 was that we'll still be good, but probably a bit softer in terms of utilization. And if anything, maybe the trend of falling fuel cost will continue.

That is not the case. Massive demand, very high utilization even into logistics. And what we see now is a surge in fuel cost, which we believe is a temporary effect.

So to the business, Shipping services down 6% quarter-on-quarter, driven by 2 things. The biggest issue and I've always touched it, that's fuel costs. And the second is capacity cost, meaning that we are paying a bit more for capacity than we thought and than we did last year.

Logistics, improving partly due to better volumes, in particular on the auto side in our operations and also because we have reduced our cost base. And I'll come back to that, but this is in historical context, a quite strong quarter for logistics.

Government Services are keeping busy, but with less government cargo than we have had previously. And that means that we have another relatively soft quarter for the government services compared to what we did last year.

Then I need to add that Q1 2025 was an especially strong year due to what they call presidential direct cargoes when one President went out of office and a new one came in.

Total volumes for shipping in the quarter was somewhat down. This is what we call normal seasonality. And I would just like to add, there is no vessel leaving port without a full load more or less, at least from the East.

So this is purely due to prioritization and seasonality of cargoes. Also, of course, the volumes are going down because we have less return cargo. We are growing more out of the East, more capacity added there and less cargo coming back. So the total volume, even though we're sold out, is somewhat down.

And then you will see, as I mentioned, that the share of High and Heavy cargoes are going up, which is good for us. That's a segment that I could -- I believe I could say that we are by far the market leader and it's also a premium paying cargo segment.

And we saw the bottom of this market. In Q1 last year, we have seen a positive trend or stable since, but we're now ticking up. And we believe and based on the input we get, that this is the start of a gradual improvement, not a massive improvement, but a gradual improvement in this segment, which we are well prepared for with the vessels and the operations and the integrated offerings we have to the industry when it comes to High and Heavy.

The net rate was marginally up quarter-on-quarter, but down year-over-year. Don't look too much on these quarter-over-quarter changes. Those are more prioritization. So if I focus on year-over-year, which is more relevant, for sure, the contracts we have for this year is slightly lower priced than average than what they were last year as we had more of peak earnings bringing in.

But then as we are increasing the amount of cargo going out of Asia and less coming back, the average rate is going up. That doesn't mean that it's good for us. We'd rather have high-paying cargo out of Asia and lower pay cargo going back, but that will then increase the average.

So in general, we would say it's rather flat. And I would say that right now, freight market is so tight that the prices are going back up. So we've seen a decline through '25. But right now, we see a pushback in terms of also freight rates, which is natural as we see a strong time charter market that is also pushing up.

As I said, in logistics, if we take out MIRRAT, which is this dotted boxes, this quarter is the best we have had more or less since COVID. Still, we have improvements to come. And we believe we can become even better.

But in historical context, this is a strong quarter. And as I said, it's driven by the auto volumes meaning that we have more volumes coming out of the factories in which we work and our factory line, but also more auto volumes moving through our terminals, which is the lower one.

Still, we are seeing relatively soft activity in High and Heavy meaning that what we do is more or less keeping the equipment for storage rather than processing them, which is high-value work. So we expect that to -- or hope that and believe that will strengthen throughout this year and into next year.

In government, as I said, a soft start to the year, partly because of less cargo coming from U.S. government. We are utilizing then the vessels for commercial cargoes, which have somewhat lower revenues than U.S. government cargoes.

And then there was one effect this quarter that our stipend because we run U.S. flag vessels went up. So that's a one-off effect and Bjornar can cover more details on that later.

Contracts, good quarter again, not a massive quarter in terms of renewals. We signed contracts for around $450 million. We are, as I said, sold out. When you look at this 2027 for shipping and you can see that we're still open 42%. That is only because we have a couple of big renewals coming up this year.

And we are confident that we're able to renew those contracts. We have had them for ages. And they are fundamental contracts to us. And we are fundamental to our customers. So this is just a normal renewal cycle that we see coming up in -- for '27.

Last but not least, we are finally getting some of our new shaper-class vessels coming out in terms of size, economy of scale, fuel decarbonization. We believe this is the best the industry can offer at the moment.

The first shaper vessel will come in around the summer this year. And then we have 7 vessels coming with 9,300 capacity. And then late next year, we will have the first big one, [ 11-7 ] coming out, which will be a new standard for the industry.

And we believe that will set the stage for even better economies of scale. And altogether, we are convinced that the shaper program will improve our competitiveness and also add to our earnings.

Progress is very good. Quality is very good. And if anything, deliveries are ahead of schedule.

Sustainability, we are doing well on safety KPIs, although a little bit of uptick in Q1 for logistics. That is due to weather-related slip, trip and falls in the quarter and also one accident where we were completely innocent. But we were actually hit by another car on the road that took the wrong turn. So all in all, if you look at our safety statistics, we're doing well.

On our emissions, we are somewhat improving, partly due to lower speeds, but also because we are implementing energy efficiency measures and we are improving our green fuel amount. And that's what I wanted to leave you with today.

I've had the luxury of being in Asia a couple of times lately and going back in 2 weeks. Sitting in Europe and maybe even listening to the U.S., you could believe that the decarbonization journey is over. It's not. It's live. When I meet customers in China, in Japan, in Korea, this is still on the agenda.

So don't get mistaken, the climate issue is not solved. People believe companies are investing for the next 5 to 10 years for competitiveness. In China, they are really investing into the green transition and our customers are investing into the green transition.

And the left-hand side shows how much of our cargo are paying up or customer in volume -- customers in measure of volume of cargo are paying up for less emissions. And when we came into 2026, 55% of the cargo volume we carried, customers paid extra for less emissions. Let's say, typically 10% more for 20% less emissions.

When we leave this year, we had an ambition of 75%. And already in March, we got the report yesterday, we were at 70% of our volumes. So we are able to offer our customers what we -- our strategy, meaning that we want to offer low and no carbon solutions and make it available and make it affordable. And our customers are signing up.

And we believe this is a massive competitive advantage going into the next few years and certainly into the '30s when we find effective ways together with customers to decarbonize, create competitive advantage for them and for us.

And with that, I'll hand it over to you, Bjornar.

Thank you, Lasse, and good morning, everyone. As you may recall, I started in position 1 year ago. I have received 0 congratulations, but I'd rather use the opportunity to do some reflection.

Before I started, a lot of players in this industry was really concerned about a couple of factors. Was this mountain of new vessels coming into the market with a big order book, we just had Liberation Day, what would happen to tariffs? Would demand go away? And then some were also concerned about EUKOR and that we had a put option on 20% of the shares in EUKOR.

So where do we stand today? There's not that many today that are concerned about this mountain of an order book. Lasse is actually concerned about capacity cost and that the time charter market is going up because the demand out of Asia is so strong.

Tariffs has been introduced, but they have been introduced at a lower level than what we feared. And as you have already heard from us, the EUKOR put, we have at least sold for the next 5 years. So I would say quite happy with the first year and where Wallenius Wilhelmsen stands today.

So let's look at the quarter from a financial perspective. I would say it's another strong, solid quarter for Wallenius Wilhelmsen. We're delivering well in what is a continued challenging global economic environment, lastly with the Middle East impacting our net bunker costs in the quarter and also in subsequent quarters.

So starting to look at revenues. Revenues for the quarter are down 1% on seasonally softer volumes for the shipping side. That is normal, partially offset by very strong volumes on the logistics side, where especially in the U.S., we are seeing that volumes and activity level is increasing.

Adjusted EBITDA ended at $389 million, as you heard from Lasse, down 3%, mainly related to seasonally softer results on the shipping side, partially offset by improved results on the logistics side.

We also had a couple of adjustments in the quarter versus the adjusted EBITDA and EBITDA around $8 million. That is related to the cost leadership initiatives that we introduced in Q4 with digital transformation and that we're also taking some actions on the cost side.

Looking at net profit. Net profit for the quarter ended at $177 million, largely in line with the previous quarter and as a consequence, also earnings per share, largely in line with the previous quarter at close to $0.40.

Taxes in the quarter, $11 million, $8 million higher than the previous quarter. The reason for that is withholding taxes as we took dividends from Ukraine. We need to pay some withholding tax for getting that funds from South Korea to Norway.

In terms of financial expenses, stable at just south of $30 million. Net debt, $2 billion, up by $330 million. The simple explanation for that is that we paid a dividend of $428 million in the quarter.

Moving over to the financial targets, which remains very solid compared to our threshold. Return on capital employed, which is rolling 12 months stands at 17.3%.

If you look isolated for the quarter, it was a little bit below 15%. Equity ratio close to 40%. It's down 2% quarter-on-quarter due to the dividend payment. Leverage ratio, just north of 1.2x. It's also up because we have increased the net debt and also the rolling 12 months EBITDA is slightly down as Q1 '26 was somewhat weaker than Q1 2025.

Liquidity reserves, we are starting to rightsize the liquidity reserves. Going into this quarter, we had close to $2 billion. We are now at $1.4 billion with the 2 main drivers for the reduction being one, the dividend payment; and secondly, that we have repaid $275 million of debt in the quarter. And that includes an outstanding bond that was maturing in March that we decided not to refinance.

Moving over to the Shipping segment and going a little bit into the details. So if we start with the revenues, revenues are down by $30 million. You can split that in 2. Net freight is down by around $20 million. That is explained by 4% lower volumes, partially offset by increased net freight rates.

And as you have heard from Lasse, the increase in net freight rates, that is largely explained by a change in the trade and the customer mix that the underlying price is slightly down following contract renewals at the end of last year. Then we also have a reduction in our BAF Bunker Adjustment Fuel charges of around $10 million.

Looking at adjusted EBITDA in the quarter ended at $333 million, that is $20 million lower than the previous quarter. Let me take you through the bridge, which you can see. So net freight, minus $21 million volume-related, partially offset by improved rates.

Then we have net bunker cost increase of $12 million. That is one part is due to the lower bus. And then in March, we got not a big hit, but somewhat of a hit of spiking fuel prices in March that partially also impacted the results in March.

Other voyage and cargo expenses that is down $8 million. It's mainly related to lower volumes. So lower volumes mean less cargo expenses. Another factor actually in this number is also what we call space charter costs. We had to rely more on the space charter market in this quarter due to high volumes. We had to rent capacity with other carriers at a high cost.

Let's move over to charter expenses. So charter expenses increased by $8 million in the quarter. And you heard a lot about from Lasse as well. This is also partly a technicality. In Q4 and into early Q1 2026, we redelivered 4 long-term charters where the cost is taken below the EBITDA line, so IFRS 16 lease accounting. So it doesn't impact EBITDA.

That was replaced by short-term -- partially replaced by short-term charters where you take the cost above the line, negatively impacting EBITDA.

So what we used to have is long-term charters below the line, replaced by short-term charters and above the line, impacting EBITDA negatively. And we also then, as mentioned, had to rely somewhat on the space charter market to cover that capacity, both of them negatively impacting EBITDA. This is more a mix effect and a negative effect on the totality.

SG&A is a positive effect of $7 million. The reason for that is that we made a material bonus accrual in Q4 last year. And we also had some year-end adjustment on the SG&A side. So shipping, another solid quarter, although somewhat down quarter-on-quarter for reasons that I have explained.

Let's touch a little bit about net bunker costs and how this affects Wallenius Wilhelmsen. So first of all, we need to say that Wallenius Wilhelmsen is very well covered when it comes to fluctuations in fuel cost over time through what we call bunker adjustment factors in our customer contracts.

However, there is a time lag in these contracts of 1 to 4 months and this varies from customer to customer meaning that when prices go up, we take a hit. And we get normal recovery and prices stabilize and then we take the benefit when prices go down meaning that over time, we would say that we are fully covered.

So let me illustrate this with an example. As you see on the chart here, if you look to 2022, when Russia invaded Ukraine, fuel prices were also spiking, as you can see with the red line. Then we took a hit, meaning increased net bunker cost in Q1 and Q2 2022.

Then our bunker adjustment factors kicked in, in Q3 and Q4 2022 and we got increased recovery. And then we also had an effect in Q1 2023 on the negative side because the bunker adjustment factors were then less beneficial and then things started to normalize. This is the same we expect to see right now.

So Q1, we had a small hit. In Q2, we expect to have a substantial hit. And assuming that things start to normalize or at least stabilize, we expect to then have positive recovery and lower costs going into Q3, Q4 and potentially also going into 2027.

So as Lasse said, this is mainly a periodization and timing effect. But it's expected to hit the results for Q2 and for 2026 as a whole compared to our expectation when we were standing here 11th of February.

Moving over to Logistics. As Lasse has already said, good quarter for Logistics. EBITDA of $42 million, up 50% quarter-on-quarter with revenue growth across several areas of the business.

We also have rate increases in this business. Rates are actually going up in many areas. Significant efficiency gains, both on OpEx side, but also on the SG&A side. And then when we compare to last quarter, we also -- similar to the Shipping segment, we had some material bonus accruals and year-end adjustments for SG&A in Q4.

So these results -- or let me take a step back. So last quarter, we shared with the market that we had ambitions to really turn around the logistics business. And we were shooting for what we call a cash EBITDA of 10%.

The results you are seeing here, that is a cash EBITDA of around 5%. So we are really happy with the results. We are really happy with the development, but our ambitions are higher and that is what the entire team in Logistics is working on as we speak.

Moving over to government, a seasonally soft quarter. It's typically a seasonally soft quarter, except for last year, where we had this extraordinary presidential cargo partially going into Ukraine. If you look quarter-on-quarter, relatively stable, so it's up $1 million. The best way to explain the results in the government segment is actually to look at the different revenue categories.

So what we are seeing is that the U.S. government revenues are going down. It's seasonality. There's also some softness in the market in Q1. That was partly replaced by commercial revenues, but with lower profitability. But then we had a rather significant increase on this MSP, so the Military Security Program stipends.

There are 2 effects there. In February this year, the U.S. authorities announced that the stipend per vessel per year would increase from $5.3 million to $6.5 million, dating back to October 1, 2025. So what you are seeing in Q1 2026 is then the increased stipend for Q1 retroactively also back to Q1 2025.

So you get an extra benefit in Q1 as it was dated back to last year where we were not able to take that increased MSP because it was announced in February. And then on the cost side, it's relatively stable.

Moving over to cash flow and liquidity position. So cash flow and liquidity position remains very strong, currently at $1.4 billion in total with cash of $900 million. Operating cash flow, $322 million. So we have been proud to present a cash conversion of close to 100% on many, many quarters in a row.

This quarter, we're actually only at 83%. The reason for that is also linked to the Middle East, where we have had a need to reduce risk by adding significant amounts of fuels on our vessels to ensure that if things get even worse, we will have the fuel available, so that we can actually serve our customers.

We have more fuel on our vessels at a higher cost and that is impacting our working capital and hence, that's a negative impact on the operating cash flow in the quarter and the cash conversion ratio. That is a temporary effect. And we expect that those normalize in subsequent quarters.

Looking at investing cash flow, $66 million, mainly related to installments on the newbuilding program. And then we also started the construction phase for the Drummond processing center that will open in 2027 together with Bertel O. Steen.

Financing cash flow, negative $439 million. That is mainly driven by the dividend payment of $427 million. Then we also, as already mentioned, had material debt repayments in the quarter, $275 million, with a big chunk of that being voluntarily. And that was partially funded by us temporarily drawing on credit facilities.

Moving on to the balance sheet. Most has already been mentioned, equity ratio of 40%, leverage ratio of 1.2x and then liquidity service at 1.4. So all in all, we maintained a very strong balance sheet. And we have started to rightsize the liquidity position.

Last but not least, let me cover the agreement we have reached with Hyundai/KIA regarding the put call option. So most of us know, Hyundai/KIA, they are our partner in EUKOR and our most important customer on the auto side. So Hyundai/KIA, they own 20% of EUKOR. And Hyundai/KIA, they have a put option on that 20% stake and we have a call option on that 20% stake.

In April 2026, Wallenius Wilhelmsen and Hyundai/KIA, we reached an agreement that the put and call option cannot be used during the current OCC program contract or in new contracts as long as the share we are contracted with the carrier is 50% or higher.

The current contract runs until end of 2029. And the date we have agreed that is the first exercise date is January 1, 2031, so meaning 12 months after the expiry of the current contract. If the new contract is renewed with 50% or more of the volumes, another 5 years will be added to that expiry date.

This has impacts on the accounting treatment of the liabilities. This is currently in Q1 is treated as a current liability. This will now be treated as a long-term liability. And the value of that -- or say the amount for that liability will assess based on the highest of 2 alternatives.

It will either be the net present value of the forecasted taxable result for the years '28, '29 or 2030 or the forecasted net asset values at the end of 2030. It's a somewhat complex to put an exact value on what will that actually be in 5 years.

So for that reason, we don't have an exact figure to share with you today. We will share that figure as part of our Q2 presentation results. It will be in the balance sheet.

What we can say today is that that amount will be significantly reduced compared to what the amount is on our balance sheet today. And it will also impacts the equity ratio positively. But it will actually impact the return on capital employed negatively for accounting reasons. We are coming back to that as part of Q2.

So with that, Lasse, I hand it back to you.

Thank you, Bjornar. Well done, well explained, some complex things to take us through. I will just very quickly say that the prospects for Wallenius Wilhelmsen are really strong.

The demand is strong. We are sold out in shipping. We expect to continue to be sold out in shipping. We expect the fuel cost issues to be neutralized over time. And then what we thought would be maybe the issue going forward was a less tight market. We see a very tight market in shipping.

We do see an improvement in Logistics, both in demand, revenues, rates and in our cost position. And then we had a soft start to the year in government meaning that we believe that this year we'll end around $1.6 billion in adjusted EBITDA.

So with that, I'll hand it over to Anders and Anette. And Bjornar to join me for the Q&A. Thank you.

All right. Q&A. Once again, I remind you that if you have questions, please post them in the webcast. We can start with a few questions. Just Lasse, going back a little bit more than a year, what did you believe at that time? And what has been the biggest surprise compared to where we stand today?

Well, I must admit that as a shipping person for more or less my whole career, we're used to cyclicality. And 2 years ago, we were quite convinced that due to the newbuilding order book and the massive amount of vessels coming that we would see a softening in a year or 2. And I'm quite surprised that, that has not happened.

And I think I've never seen before a segment that's been able to accommodate a 40% more or less growth in capacity without seeing reduced utilization of the fleet. So this cycle and the strength of the market continues longer than we actually expected.

Although we made contracts that we were well covered, the strength of the market in the shipping segment is amazing. And it is due to the unprecedented growth of exports out of China.

Yes. Bjornar, we're 1/3 into the year. We've adjusted our prospects a little bit. How confident are you that we're going to meet our targets?

Do you want that answer in decimals or no, I think I would say 3 things. So first of all, when we share our outlook, it's always based on no material adverse effect.

No, we have been listed. So that's changed the rules of the game. Secondly, I would say that the reason why we are reducing our forecast, that's not due to lower demand or lower utilization.

It's due to higher costs, which we have explained. And thirdly, at all points in time, what we aim to share is our best estimate of what we believe the year will bring in terms of results.

Okay. Are there any questions in the audience? Last one, I think I forgot all about that. So I'll take that first. There seems to be no.

So we'll take our first question from Sondre at Nordea. In terms of contract renewals, you touched a little bit upon it. But we have around 40% coming up for next year. How can you split those? And where do you think that negotiations is going?

I would say that you can split it into 2. We have 2 very big contracts coming up for renewal, one in the High and Heavy segment and one in the auto segment.

The High and Heavy contract is with a long-term strategic customer of ours. They want and we want to conclude that contract and that is progressing well, starting late this year. The other one with the auto customer. We also believe that we have a unique product due to our size and coverage. So we are both -- confident in both of those.

The other part is related to growing volumes out of China and also renewal of contracts out of China. And I'm sure we could have doubled our volumes today out of China based on our fantastic presence and product there, but we don't have the capacity. So I'm not concerned about our ability to fill the book for 2027. It's more a question of who do we prioritize.

Yes. He also has a follow-up question on China really. And how is our customer relationship with our Chinese customers? And how is that differing from what we see towards our legacy customers?

I think what we see in China is natural in the phase that China is in, meaning that they're growing extremely fast. They don't know what the future next quarter and next year brings. So that means they've been rather transactional short term when it comes to shipping while they are much more structural and strategic when it comes to what we call destination logistics.

So as we shared earlier, we have with the Chinese account built up the complete distribution capability in Oceania with picking up the cars in the terminal, processing them, making them ready to deliver to you as a customer, bringing them out to the dealers, doing everything basically. And this is something that's much more strategic for them now.

So our strategy with Chinese customers is really to use our global footprint. The fact that we can serve them and help them scale in destination markets and use that also to have more long-term strategic relationships with them on the shipping side.

Right now I would say that the rule of thumb in China when they source shipping contracts is to typically do 1 year. But again, they are renewing with us and with the partners because they really need support.

Okay. Another question from Sondre was around our fleet strategy. Our average age is increasing. Demand seems to be high. How do we care to approach that?

We've been around for decades. When we think on fleet strategy, we think for decades. That's why we developed the Shaper program because we believe we need to make vessels that are cost-effective and energy effective and able to reach net zero over the next 10, 20 years. We have filled up with quite good contract -- well, fleet renewal now up until 2028.

And we are continuously looking at opportunities beyond that. We will continue to build vessels. We will renew our fleet. We will continue to build vessels that create competitive advantage.

And we will continue to source vessels in the market from close partners and we are doing that as we speak. So we have a very long-term perspective on keeping our capacity and growing with our customers.

Okay. I have one for you, Bjornar. Cost pressure in Q1 from TCN vessels. Can we expect that to continue into Q2 and Q3?

Yes. So what we are seeing is that the demand is so high. So we are in need of somewhat more capacity than what we expected going into this year and the market is very tight.

So the charter prices are high. We also when we space charter with our peers, the prices are going up. So we are expecting that capacity costs going into '26 or the rest of 2026 will be somewhat higher than what we expected just going back 3 months. So that's where we're at.

And let me add to that. We're also expecting that freight rates will pick back up because these 2 factors are, of course, very closely linked. And we talk about the charter expenses. It's both our need that we have more volume than we thought. We need more help to carry it and that the rates are going up somewhat, but not so materially that it's threatening our margins in any significant way.

Okay. On rates, Petter Haugen has a question. Last quarter, we disclosed that our average rate in our book of business on the shipping side was around $55. Where about is that now?

On the...

Average rates in the [indiscernible]?

The time charter equivalent or the daily rates?

No, the --

TC rate.

-- rate per cubic meter was around $55.

Oh, I should have able to take that on top of my mind, but I can't. But we'll look it up and we'll make sure to send it to you, Petter. Right?

Probably quite close.

We can guess, but that's fine. Yes.

There's a question from [indiscernible]. Do you see any positive effects of the recent trade agreements that you have signed with Merck Azure, India and Australia?

Not really. And I would say that both India and Australia are not typically sourcing areas for the U.S. Somewhat, we see an increase in the global production output of High and Heavy equipment in India, but still early days. And the export out of the U.S. in terms of autos are soft and not very relevant.

And the High and Heavy volumes are stable. So I would say we have not seen that and we don't expect to see it that much. But having said that, what we hear from more and more customers, in particular, in the High and Heavy segment is that India is becoming an increasingly important global production hub. So we are certainly keeping a good eye on India in terms of their exports of heavy equipment.

Okay. Another one for you, Bjornar. Cash EBITDA of 10% in Logistics. When do we think we can come there? And do we do that organically or by M&A?

Yes. So we haven't set an exact date, but it's certainly not in '26. So we have -- the way we think about it is that we have now, let's say, 2 years to work hard on improving this. And then we have an ambition that we enter 2028, we should have a materially higher margin in that business. And that is largely fixing what we have today, filling sites, being more cost-efficient, et cetera, et cetera.

It's not about buying our way out of the problem, although we are always open for good investment opportunities on the logistics side.

Okay. Another logistics question. There are many operators that invest in multistory facilities on their terminals. Are we planning to do such things and...

We are doing such things. And you can come to Drummond next year or actually maybe start -- we're already starting. That is a multistory facility fully integrated with a vehicle processing center and the storage with multistory.

And you might ask why is that a relevant question? For sure, ideally, would like to have big open spaces, put the cars where we want them and not drive them up and down in buildings. But the world is such that most of these terminals sit in close to city centers and that's why we need to be more efficient.

So we have this -- we will have this in Drummond. We already have it in Southampton. And we have good experience with operating these kind of facilities.

All right. There seems to be no further questions. We'll pause a little bit just to make sure that there aren't any sitting in the queue. But -- and this is a final warning. If you have more questions, you should post them now. I think there is none.

So if there are additional questions, we'll answer them on e-mail or otherwise. But I guess that ends it for today.

Thank you, and see you again after the second quarter.

Thank you.

Good morning, everyone, and a warm welcome to our quarterly presentation. It's good to see so many here in the audience. And also thanks to all of you watching us online. We are closing the books on 2025, Anders. So what can we expect today?

Today, we can expect to hear a little bit about the journey that the company has been through over the past few years and a bit about where we're standing today. So...

We are ready. And then at the end, we will do a Q&A session.

Yes. As usual, there will be a Q&A. The audience will have the ability to ask questions, but you can also ask questions online. We have a new system today. So we hope it's going to work all right.

We know it's going to work.

We know it's going to work, but post your questions in the Q&A box and allow some time before it arrives on this end.

And then we are ready to kick it off. Are we?

Indeed.

Yes. So Lasse, the stage is yours.

Thank you, Anette and Anders, and thank you for joining online and for joining here in this audience. I was asked this morning, so Lasse, when you go on stage for these things, are you nervous? And I said, no, I'm proud. And I'm really proud of being privileged to be the front face today of a team, global team that I think has delivered another fantastic year, another strong quarter and has changed the nature of Wallenius Wilhelmsen. And I'll try to explain why, and then Bj�rnar will help me with that.

So let's get to it. Starting with the highlights. We have delivered another strong year, ending with adjusted EBITDA of above $1.8 billion. The quarter ended at $400 million, another strong quarter, slightly below or below last quarter, but still in the bigger picture, a strong quarter. And thanks to the strong results and also the very strong financial situation and our good book of business, we are in a position where we can pay strong dividends and extraordinary dividends, and we are today announcing a dividend of $1.01 per share for the second half 2025.

We see continued strong demand out of Asia and the story that I've been telling for the last few years continues. In shipping, we are more or less sold out. We are also continuing to extend our contract base, what we call book of business, and Q4 was no exception. We added another $1 billion worth of contracts.

So at the back of all of this, we are still expecting a solid 2026, and we are keeping our outlook for the financial results with an adjusted EBITDA between $1.65 billion and $1.75 billion, which will be another historical strong year for the company.

Before we dive into the quarter and the year, I wanted to take a step back and look at the last couple of years because the company that comes out of, call it, this cycle, meaning into 2026 is a very different company that went into this cycle in 2022. And we have changed in 3 principal areas: In our financial position, in our commercial position and in our operational excellence. And I'll give a little bit of background on each of those.

On the financial, we were a highly leveraged company a few years back. We have repaid half of our debt in the period at the same time as we have returned more than $2 billion to shareholders in dividends. So today, we are a moderately leveraged company, meaning that we are in a position where we can withstand future low cycles if they come. But much more importantly, we can be a stable long-term player in the industry for our customers. We can act countercyclically when we see opportunities, and we can make sure we deliver on financial policy and keep strong and steady dividends back to our shareholders.

We have also transformed commercially and the book of business we have today, when we left 2025 and came into '26, we had a unique book of business, meaning a total set of contracts, both in shipping and logistics far above where we've ever been before. If we focus in on shipping and the book of business, we had a total backlog leaving last year of close to $7.5 billion, lasting for an average 3.3 years with an average rate, so to speak, that means rate per CBM, that's how we measure our income, of $55. If you look historically, the green line here, you can see that, that is way above where we've been historically.

So this means that as long as the world continues, and I will come back to that and the volumes continues, the rates we have secured will take us forward on a level that is strong and sustainable. We are sometimes compared to the time charter market, time charter market being how much do we pay to rent the vessel. That's the red line. As you can see, that's not how we measure our income. That's not what creates our income. That's our cost. That's what we pay for vessels. So what we deliberately avoided over those years, we can see the peak of the red was that we did not put on any massive new tonnage, meaning that we were not sustaining these high levels of payments on time charter, which has been very important for us, challenging in terms of prioritizing, but very important.

So much stronger financially, I would say, solid financially, solid book of business and also worked to improve our operations. And I would say that today, we are a much more integrated and unified company than we were when we came into this cycle. And also, we have entered quite a few new acquisitions, both in the shipping side with Armacup, in logistics with Syngin and ALS. And we are today also operating effectively as one economic entity across EUKOR and Wallenius Wilhelmsen Ocean.

We have started fleet renewal with upscaling our vessels, making them ready for green fuels, and we believe creating competitive advantage for the years and decades to come. We have expanded our network. We have built the biggest terminal in the U.S., I think, in North America in Brunswick and opened that. We opened last week the new terminal in Gothenburg. We have extended our network at the back of Chinese exports into Australia. So we are extending our network to help customers with destination logistics.

We have also taken a leap on decarbonization. And I'm very proud to say that in 2025, 50% of the cargo volume we carried our customers paid up for lower emissions. And I would dare to state that, that's rather unique in our industry.

And then we have started on a very look-through and deep digital transformation, where we are now investing heavily into making sure that we are standardizing and digitizing operations to be more cost efficient, more productive, more scalable, but also, of course, ready to deploy AI into our operations. And Bj�rnar will come a little bit back to that investment later. So in general, I think it's important to say that although maybe Q4 was a little bit on the lower side compared to our expectations, 2025 was a very strong year. The company is in a very good shape. And actually, our expectations for the market into 2026 is strong.

So then what shapes the market. You cannot avoid talking about geopolitics. I'll touch that. Then I'll talk about the driver being the Asian exports and then also on the fleet growth in shipping, which really drives the supply-demand balance. There's no doubt that we are in times of a changing geopolitical situation. Call it geogovernance is changing. And we are seeing now that we're going from a world where we have had, let's say, one global set of trading and where we have had more multilateral agreements into a world which is more bilateral.

And I think this is important for us to say the world trade is not stopping. It's just changing. And the fact that some countries are protecting themselves more with tariffs does not mean that everybody else do. And we have seen new trade agreements opening up with EU and Mercosur, EU and India, new trade deals between Canada and China. So what we see is a new emerging trade system with more bilateralism. Like it or not, but it's a fact and trade continues.

When it comes to the market we are in, moving stuff that can roll being a car or excavator or a truck or harvesting equipment, that market is, all in all, not growing much. So if you look year-over-year, there are not too many more cars sold in the world, but there are more cars transported. So from 2024 to 2025, the total volume of cars moving on vessels, call it deep sea, increased by 5%.

And then if you look at the big data providers in our industry, S&P being one, they estimate maybe only 2% growth into next year. We challenge that. And also, it's important to understand that behind that, there is a big difference in what -- where are we growing and where are we shrinking. So if you take one step back and see, can we trust this number, the answer is no. When we started 2025, the expectation for volume from the year was 15.2 million cars transported, the result was 15.6 million.

At the same time, if you looked at the expectation for '26, the expectation was 15.5 million. Now it's up to 15.9 million. Why? Because the Asian export is constantly surprising on the upside, and I'll come back to China. And unfortunately, for European players, the European volumes or the ex-EU volumes are declining. So there are 2 effects there. One, we're underestimating the Chinese growth. And the second is that although the total transported numbers are down, they are increasing in Asia, decreasing from EU, but they are part of the same voyage. So with lower volumes coming out of EU, it doesn't really drive demand for our vessels. But for every single car China adds to their exports, they need more capacity. And they need that on a full round trip voyage maybe lasting for 2 months.

So that means that underneath these minor expectations on growth, there is actually quite substantial growth in the demand for our shipping services. And we wanted just to illustrate that out of China. The Chinese car exports have grown tremendously, and they continue to do so. And they've grown, let's say, around about 2 million cars from '24 to '25. And I'll repeat that, 2 million cars in growth in exports, basically needing our capacity to do so.

Again, if you look at the forecast for '26 from the official statistics, they expect slower export next year. When we pick up the phone and we call and we check with our customers, and these are public statements, so I can share them with you. If you just take the biggest customer or the biggest players and what they have claimed, this is what we will transport next year and sell next year, you can add 2.3 million cars to that.

That is why we believe that, again, China will surprise on the upside. And the reason why it's still so tight and sold out in shipping is that all the added cars that has come in from China has more or less filled up the new vessels delivered, and I'll come back to that. So our expectation for '26 is that we would more likely have a growth similar to the one from '24 to '25 than a negative development as forecasted. So we believe that there are upside in these numbers, and this is also what we see on the ground.

When we now look at our bookings and what our customers tell us, we have very strong bookings through Q1 and into Q2. So the big worry has been over the last few years, the supply side, too many vessels ordered and meaning too many vessels delivered. And that is true. We have never, I think, in the history of this industry, taken more vessels delivered than in '25. Still, there are hardly any vessel to find if you want to make a charter. And why? Because more or less exactly the need -- increased need out of China has been matching the increased capacity coming out with new vessels.

2026 will be another strong year in terms of deliveries. But if you believe, and this is an if, you believe that the China export story will continue, which I just showed you, that extra volume out of China more or less matches with the extra capacity coming out of the yards. So we don't see any weakening in the demand for our services, and we don't see, at the moment, any weakening in utilization of our vessels.

And actually, what has happened over this year is that the time charter rates after falling for a while, I showed you that earlier on, has now picked up. Why? Because there are hardly any vessels available if you need to charter a vessel. So the shipping market is very tight. The market for our logistics services are very tight in some places, but there's no doubt that we have been affected in the U.S. I'll come back to that. And in the government sector, we have -- saw a little bit of a slowdown due to some factors beyond our control.

So if we then jump into the business, Bj�rnar will come back to the quarterly numbers and give you the details. Here, you can see the year-over-year. If you look at shipping, although maybe a little bit below what we were hoping for Q4, if you look year-over-year, the shipping adjusted EBITDA is basically flat. We are delivering at the same level. The reason why, as I just told you, we're sold out. On logistics, we are down year-over-year, partly as we sold a big terminal in Australia, MIRRAT, I'll come back to that.

While in the Government Service, there's no doubt that Q4 ended below our expectations and also the year did. And this is basically caused by the U.S. government shutdown. They didn't have people in the office to order our services and also a couple of other factors that came into play. It's not a sign that there is a reduced structural need for the capacity we have in our Government Services.

If you look at shipping, volumes are slightly up, and then you would expect to have a stronger quarter. The thing is that this is periodization. So we had much more volume going back from Europe. relative to what was going out of Asia. This is not a general trend. This was a very specific thing for the quarter. So we had higher volumes, but lower rates, thanks to that. And the way it works in the shipping area is that when you take something out of Asia, we call that the front haul, we are paid far more than going back from Europe, which is a backhaul.

So if we have, relatively speaking, in the quarter, more volumes out of Europe, the net rate falls, meaning our earnings falls, but that's just periodization. The general trend is fast-growing volumes out of Asia and decreasing volumes out of Europe. And if you look year-over-year at the bottom right, you can see that thanks to increased prices and thanks to more customers and more cargo into trades with high-paying customers, the rate year-over-year is up. So the small dip in the rate in Q4 is not representative necessarily for the year as such.

In logistics, as I said, we have not delivered the results we were intending in last year. I would say that with one exception, we sold the MIRRAT terminal in Australia. I think that demonstrated the value of logistics, but that also took out quite a bit of our EBITDA. Then we had 2 big concerns during the year. One was the fact that the Europeans slowed down their exports into U.S., thanks to tariffs and uncertainty. We are big on terminals out of Europe. We're even bigger on terminals into the East Coast of the U.S., we were affected.

Second is that the high and heavy, meaning that the construction industry are not buying new excavators or tractors and the agriculture industry not harvesting machines. That sector is slow, and that has also affected into our logistics business. So all in all, we have seen a lower return in logistics. And that's why we have said that we have very much focused now on bringing that business back to a good margin. And we have a clear target within 2 years to bring it back to an operational result of 10% and we are doing quite a few things. We are now looking into reducing costs. So we have reduced costs. We are growing our network, opening new opportunities, growing with customers and also increasing the volumes through the existing facilities that we have.

So we have a clear plan for how to improve logistics, and we are not where we are, where we should be in terms of financial returns for 2025. And in government, as I said, we had a slow period in Q4. We do not think that's representative. And we were just announced by U.S. government that they have approved the budget for increasing the stipend we get for running a U.S. operation, which will have a net effect of more or less of $10 million a year, likely accounting for the full 2026.

Finally, book of business, another strong quarter in terms of adding contracts, close to $900 million in shipping and $150 million-ish in logistics and building on to what we already have. And as you can see, we are totally sold out for 2026 in shipping. For 2027, we have quite a few renewals this year, but these are many of them contracts that we have had for decades, and we expect to renew them, but it's not done yet.

So then before I turn over to Bj�rnar and the numbers, let me touch on sustainability. We are very happy that we are delivering better every year on safety. For us, safety is a fundamental and foundational value that we want to bring people home safe. We had no serious accidents in the whole operation of 12,000 people going to work every day for us in 2025. We're proud of that. And we also see that the statistics for the smaller accidents are coming down. And this is thanks to a very hard work and dedicated effort in the organization and the fact that we have as one of our core values, we care, and we care for each other, and we take care of each other.

On the emissions, unfortunately, we have seen an uptick in the emissions. That's partly due to bad weather in Q4. Normally, we have that, but also the fact that we had to increase the speed a little bit to basically catch up with the enormous demand we have from customers. The big picture is that we are consistently reducing the emissions per what we call transport distance, meaning that for every nautical mile we sail with our vessels, we are reducing the emissions, thanks to dedicated efforts in everything from operational technology to physical installations of the vessels, reducing the energy consumption. So with that, Bj�rnar?

Thank you, Lasse, and good morning, everyone. I actually got the same question as Lasse and my response was, I'm proud, but also a little bit nervous and the reason that you have so much energy when you start, Lasse. So I've been told today that I need to have the same energy. So I will do my best, but no promises. Financial update. So let's start by wrapping up the year. So if you look at 2025 as a whole, it's a new fantastic year for Wallenius Wilhelmsen, although it's slightly softer than the record year 2024. But if you look in the historical context, it's a fantastic year that we are very, very proud of.

Starting with the revenues, $5.2 billion in revenues this year. It's down 1% compared to 2024. This is, I would say, largely explained by the Logistics segment, where we have somewhat softer revenues, down 10%. The majority of that is due to the sale of MIRRAT and also slightly softer revenues for the auto and the high & heavy business in the U.S. And then we had a soft Q4 for ARC for reasons already mentioned by Lasse.

On the positive side, shipping is basically flat compared to 2024, representing the underlying stability we are seen our business right now. EBITDA ended at $1.8 billion. It's around $60 million below last year with the reason for that again being logistics, primarily due to the sale of MIRRAT but then also slightly softer performance for Government Services, while Shipping were spot on last year.

Then we have some adjustments to EBITDA last year, 3 main factors. We sold 2 vessels during the year with a sales gain of $28 million in total, which we consider to be an adjustment to results. It's not part of our underlying business to sell vessels, although I know a lot of bankers would like us to sell vessel and to rent them back expensively afterwards. We are not in that business.

Secondly, we have used our port fees in the fourth quarter of $21 million. I consider that to be an adjustment because it was specific to the fourth quarter, and the port fees are currently on hold. Then lastly, we had around $12 million related to digital transformation and restructuring costs in the fourth quarter. I'll be coming back in a little bit more details around what this is all about. So if you then look at the adjusted EBITDA, we end up at also around $1.8 billion, $90 million below last year.

On the positive side, net profit actually increased in 2025 compared to 2024. And the reason for this is that we had a very positive sales gain when we sold MIRRAT in May, which more than offset the decline in EBITDA. Looking at the financial targets, I will only comment on one of them, return on capital employed ended at 18.4%, so slightly lower than last year, but still at a very, very good level.

Then moving over to the fourth quarter, I would say it's another strong quarter, although it's below what we delivered in the third quarter. So when someone talks about softness, I wouldn't say it's soft when you deliver a return on capital employed of 18.4%. That's a strong quarter.

Starting with revenues, down somewhat more than $50 million compared to the last quarter. This is largely explained by the Shipping segment, but also lower revenues in Government Services and slightly lower revenues on the Logistics side. EBITDA ended at $379 million. That is a significant drop from the previous quarter of around $100 million. The quarter included, as I already alluded to, a couple of adjustments to the result.

So number one, we had USTR port fees, $21 million. Then we also sold a vessel in the fourth quarter. This was an old vessel, more than 30 years or around 30 years old. We had a sales gain here of $12 million. And then we also had $12 million related to digital transformation and restructuring cost that was taken as adjustments to EBITDA.

Let me comment a little bit on the latter, and this is following from what Lasse said a little bit earlier in the presentation. During the second half of this year, we kicked off 2 initiatives, which we have put under what we call a cost leadership umbrella. And this is all about making Wallenius Wilhelmsen even better positioned for the future to deliver a good service to our customer and good returns to our shareholders.

The first one is about digital transformation. Very simply digital transformation that is about upgrading all our existing systems to be future-proof for the future to ensure that we can become even more cost efficient going forward. The second one is about SG&A cost efficiency, where we are taking some measures here and now to reduce the run rate for SG&A by $30 million with effect from later in this year. This is already in process.

So what are we doing on SG&A cost efficiencies? I would say split in 2. One, it has a people impact. We will be fewer people in Wallenius Wilhelmsen in 2026 than we were in 2025. And we're also taking out some external costs around consultants and IT cost. Doing these changes certainly requires some investment. So if we look at digital transformation, we are investing $50 million this year into our new system capabilities. When you look at SG&A cost efficiencies, we will have restructuring costs of around $15 million this year in the beginning of the year, the first half mainly.

We consider these to be adjustments to EBITDA as it is not representing the underlying development of the business, but investments that we are doing in improving the business longer term. It's also key to highlight that for both these areas, the business cases are very, very positive and the payback period on that investment is rather short.

Adjusted EBITDA, taking all this into consideration, then ended at $400 million, also below the previous quarter and last year with around $50 million, with the main driver being the Shipping segment and the Logistics segment.

Moving over to net profit, $175 million, short of what we delivered in Q3 and also the same quarter last year. The driver for this is the lower EBITDA, but it was partially offset by lower financial expenses. And why do we have lower financial expenses? The reason for that is that we have lower debt. So the cost to service our debt has come down quite significantly. The second part is that we had a lower tax expense this quarter with the main reason being that under Government Services, the company ARC, which is a U.S. company, they entered the U.S. tonnage tax regime, which is more favorable from a tax perspective. And then we had a reduction in our tax liabilities and also payable taxes is down around $7 million for ARC.

Looking at our net debt position at the end of the quarter, it was around $1.7 billion. So it was down close to $200 million during the quarter. The driver is continued reduction in our bank debt, close to $200 million, of which $125 million of deduction was actually voluntary repayment of debt. Cash, as you can see, was largely stable quarter-on-quarter.

Looking at the financial targets, ROCE, as already mentioned, 18.4%. That is actually the same as what we delivered on average for the year. So how can we then be as good in the fourth quarter as we were throughout the year when EBITDA was somewhat on the soft side in the quarter? And the reason for that is that the balance sheet management has improved. We are being more effective in terms of the way we manage our balance sheet.

Equity ratio of 42%, up around 2%, 3% quarter-on-quarter due to the positive net profit. Leverage remains at 1x, very stable. And then our liquidity reserves now stands at $2 billion, 2x the minimum target. This was an increase of close to $300 million in the quarter. The driver for this was that we added even more capacity on the credit facility side. This is actually linked to the voluntary repayment of debt as we repaid old vessel debt and we refinanced the vessels into a credit facility of $200 million, where we have the flexibility to draw up and down on that capacity, and of course, with lower margins and also extending the maturity into around 2030, 2031.

Moving over to the segments, starting with Shipping Services. Revenues around $975 million, somewhat down quarter-on-quarter due to net freight being lower for reasons already explained by Lasse, although volumes were stable. Looking at adjusted EBITDA, $354 million, that is down around $50 million quarter-on-quarter. Let me take you through the bridge to see what was driving this. First of all, net freight down $38 million. Around $10 million of that was linked to prior period adjustments or adjustments in voyage estimates. We always do estimates of our voyages and how much they are generating in revenues and costs, and then we did certain adjustments at year-end.

The rest is explained by the trade mix, but also the fact that we did quite a lot of big contract renewals in the fourth quarter, which impacted the underlying rates in the quarter. So this is what we have talked about lower for longer deals. So very strong value creation in the long term, but we are taking then slightly lower rates in the short term.

I would also like to comment on other voyage and cargo expenses, where you see there's a minus $30 million and there is a plus $21 million. The plus $21 million, that's USTR port fees. So the net difference is $9 million. Also in this bucket, we have certain prior period adjustments to the voyage estimate, $5 million, $6 million. So the underlying cost is relatively stable. Also vessel OpEx, that is up $5 million. This relates to the fact that in the third quarter, we had an insurance claim or a refund from an insurance claim of $4 million. So like-for-like, it's also rather stable.

Then SG&A, there is a rather big change in SG&A here in the fourth quarter. This relates to the fact that at year-end, we make accrual for discretionary bonus if there is discretionary bonus. As you have seen, we have had a fantastic year, and then we also share with our employees, not only the shareholders. So that's why SG&A is up in the quarter.

Moving over to Logistics. Revenues largely in line with the previous quarter. It's a drop of $10 million. This is explained by lower revenues for the Inland segment. This is a business with relatively low margin, so that didn't impact EBITDA to a large extent. EBITDA, $28 million, it's down $6 million compared to the previous quarter. At the same time, I would say that the underlying momentum in logistics was rather good. And why am I saying that? The reason is that you see auto is up $2 million, high & heavy is up $1 million, terminals is slightly down. That's the fact.

Inland is stable, while other is significantly up. Other that is SG&A cost. $4 million here is also accrual for a discretionary bonus to our employees we take in the fourth quarter and $3 million is related to changes in SG&A cost allocations between the ASA Holdings segment and the Logistics segment where we go through the allocations throughout the year at year-end. So meaning that the underlying momentum of the business is rather solid, but then we have some extraordinary costs related to SG&A for Logistics segment at the end of the year. In particular, I would say that this is a strong result as one of our key customers had a cybersecurity attack in the fourth quarter that impacted the auto business in the U.S. and also the terminals in both Europe and in the U.S.

Moving over to Government Services. Revenues were down quite significantly in the quarter. This is -- as already explained by Lasse, this is due to the 43-day government shutdown during the quarter. Then as some of you may remember, we said in the third quarter that the U.S. authorities activated a vessel in September that took some of the volumes we would typically have a chance to carry and that also had an effect into this quarter. And then Q4 is normally a seasonally weaker quarter, although we didn't see that last year, but that was due to some extra activity with the change of President in the U.S. Looking at adjusted EBITDA, $22 million. So it's -- the EBITDA is actually cut in 2. The main -- or the only driver for that being the especially low revenues that we experienced in this quarter for reasons already mentioned.

Moving over to cash flow and the liquidity position. So at the end of the quarter, as already mentioned, we had liquidity reserves of $2 billion. That was an increase of $268 million compared to the previous quarter, consisting of close to $1.1 billion in cash and the rest in credit facilities. Looking at some of the items here. So the net investing cash flow, that was $61 million. This is mainly related to CapEx for our new building program, both the vessels and equipment for the vessel, partially offset by the fact that we sold old vessel, meaning 30 years old in the quarter. It was sold in the previous quarter and delivered in this quarter.

Financing cash flow, negative $313 million. This consists of interest payments. The net proceeds and repayments, this is split in, I would say, 3 parts. One is regular payment of bank debt around $60 million, $70 million. Then we had a voluntary repayment of $125 million, and then it's lease payments being the latter part.

I think we will jump over the balance sheet because that's already covered. Then the highlights for the day, dividends. Yesterday, it was approved by the Board that we will pay a cash dividend of $428 million for the second half of this year. The dividend is based on 50% of the net profit for the second half of the year, meaning in the upper end of our dividend policy. And then we have added an additional element, an extraordinary element of $200 million, considering the very strong financial position of the company with liquidity reserves currently around $2 billion and a leverage ratio of just 1.

So if you sum up the dividend for H1 2025 and H2 2025, we actually returned close to $900 million to shareholders this year, representing $2.11 per share, which we are very, very proud of. The dividend will be distributed to shareholders towards end of March.

With that, I will hand it back to you, Lasse.

Thank you, Bj�rnar. You did great. And you kept the energy up, although it's hard to follow some details, but you made it easy. Okay. So I will just finish up with the outlook, and I want you to make sure that when you think of the expectations for Wallenius Wilhelmsen going forward, make sure you have calibrated your view on where we are. We have totally repositioned the company financially. Bj�rnar explained you that. We have cut the debt in half. We have paid a lot of dividends. We have proven that we can pay strong dividends, and we have a strong cash position. We have a strong book of business, taking us years forward, and we are improving the operations in safety, in environment, in digital and in all parts of our organization.

So we are expecting another strong year in 2026. The demand from the market is strong. If you believe that the Chinese export story continues, most likely, that will need all the vessels that will be delivered next year. We are working hard on improving the performance in Logistics, and we expect Government to come back to more normal levels after an extraordinary Q4. So we maintain our expectation for 2026 of an EBITDA of between $1.65 billion and $1.75 billion, which will be another very strong year for Wallenius Wilhelmsen. Thank you.

Okay. So our new system is actually working. We have some questions. But starting off with you, Lasse, a lot of the questions are touching on the Red Sea. What does it take to -- for us to go back?

Yes. So take one step back. So the last couple of years, it's not been safe to go through the Red Sea due to the threat out of Yemen and the Houthis in Yemen. I would say that when you look at the Red Sea, you need to think of that in 2 senses. One is, do they have the capability to still attack? Unfortunately, that's still the case. All the capabilities are there. And then they also need to have an intention to attack us. That is, at the moment, thankfully, not there. But as we all know, the situation in the Middle East is volatile. So we are constantly looking at the safety situation. We do not consider it safe to go back yet, but we are preparing. And we know we will go back one day. But as of now, we are not planning to go back anytime soon.

As a follow-up to that, in terms of capacity, what would a return to the Red Sea mean for us?

When we started to avoid the Red Sea, meaning that we had to go all the way through around Africa, getting to Europe, for instance, we said that, that would -- that took 5%, 6% of our capacity out, meaning that we lost 5%, 6% of earning days. When we now study that, we will not get 5% to 6% back due to 2 reasons. One, we -- the world fleet increased the speed a little bit when we started to go around, going back to the Red Sea at some point, probably we'll get back to the same speeds.

But even more importantly, the world trade has changed. So over this period, the growth out of China has been bigger outside Europe than inside Europe, meaning that more of our vessels are going to destinations, which are not necessarily getting the full effect of going through the Red Sea. So we are saying maybe 3%, 4% of capacity will be added when we can have a full availability of the Red Sea.

Thank you. Then for you, Bj�rnar. We're starting to get deliveries of the Shaper classes this year. What do we do in terms of financing?

Yes. Thank you, Anders. So we have already financed 11 out of the 14 vessels. So the 3 vessels not financed. There is a natural reason for that. Some of the vessels for last 4 vessels will be delivered in 2028. That's more than 2 years down the road. Securing financing already now is expensive as we need to pay the banks certain what we call commitment fee just to haul that capacity. And we don't want to secure that capacity earlier than what we need as we want to avoid unnecessary fees.

The banking market for us is extremely strong. So there's no worries at all that we will be able to finance these vessels. The banks are calling my colleague, Birgitte every day, and we'll probably also call after this meeting and even here, more banks here than investors, it looks like. We will be financing these vessels late 2026, early 2027, and it's just a natural timing to avoid unnecessary fees.

All right. Then a bit of a tricky question, which kind of goes to both of you. We did provide guidance mid-December. We didn't actually reach that. And a few questions goes on why is that and what are the reasons behind the...

Yes, I'll start and then you can finish. The biggest surprise we had was in the Government Service. And I must say that we are -- I mean, we just need to be honest that we were not good enough in understanding the late effects of the shutdown in the U.S. We should probably have been able to see those signs earlier, but we didn't. So we overestimated what -- the results in government.

And then the other part, as Bj�rnar touched, was really that we're -- at the end of the year, sometimes you get some adjustments. We have more than 500 voyages during the year. When you close the books, you do an extraordinary check of those voyages and that really results in some previous period adjustments, which we might should have seen also, but we didn't, unfortunately.

But I think the positive side is that the underlying momentum of the business was in line with our expectations.

That's true, except for Government, but that's not structural. We think it was just a one-off.

A follow-up to that is that do we expect an improvement into Q1 then?

Quarter-on-quarter. Well, we have not given any numbers into Q1 yet because there is no doubt that there is still uncertainty, but we are maintaining our forecast for the full year, and that indicates that also Q1 has to be a strong quarter for us to meet that.

Yes. There is also a question around the range that we provide in the guidance. What constitutes that range or what makes the difference between the low and the high point?

Well, I learned from a very clever person that to look forward, you need to look back. And if you look back 1 year and what happened during 2025, and it's when we started this last year, we haven't even changed President in the U.S. and looking at everything that happened through the year and then thinking that you can find one fixed point 1 year forward on earnings in a global business with global infrastructure. We're connected to every country, every trade, every port more or less in the world, that's impossible. So of course, there are uncertainty in our numbers. But as we have said, we have big confidence in the demand for our services.

Okay. Then there is a little bit about the rate development quarter-over-quarter. I mean, I guess some are asking, can we explain what made the rate go down and what will take -- what it will take?

Two main things. And now we're talking about the rates in shipping, right? And there were 2 main things. One was just periodical trade mix, meaning that quarter-on-quarter, you have -- we had slightly more cargo out of Europe versus out of Asia, and that pays less. And then the average rate goes down. The other one was very deliberate decisions that we, together with our customers, have taken on longer contracts. We have announced those where we have longer contracts at good levels, but somewhat below the peak levels that we had when we entered into the contract. So we have deliberately reduced some of the rates to secure longer business, and part of it is just periodization.

There is also a question around that. What -- in terms of longer for less, if we do that, what kind of reductions are we looking at? And what kind of net present value...

Of course, we will not go into every single contract. We have said that there has to be a net present value for us. It needs to be -- we need to be better off. And then our customers right now are very much keen on getting a, call it, cash help on the short term and are willing to add commitments to the long term. We show today that the average rate in our book of business going forward on shipping is $55 per CBM. That is a strong number and historically way above what we have seen as an average. And that indicates that although we are maybe reducing some rates from the peak, they are still historically strong.

And on that, our book of business shows that there is a decent amount of contracts that are going in for renewal next year. What are our expectations in terms of those renewals and given that fleet balance is...

Listen, let me answer more seriously. One, there's no doubt that peak rates are behind us. But as I showed, the demand for vessels, the tightness in the market is strong. Our customers are still concerned about capacity and they're coming early. We have already started renewal discussions in January and February this year of contracts expiring by the end of the year. So we, of course, expect to renew these contracts, not at rates that maybe were achieved in 2024, but at rates likely above what we have had historically. But this is a speculation. These are discussions going on right now. But for the big chunk of what we have to renew this year, as I said, we have done these customers, these trades, these contracts for decades, and there's a strong mutual dependency between us and our customer.

Then one on the Government side. I can go to you, Bj�rnar. Do you expect to recoup the kind of lost revenue that we saw in Q4?

I think that's a good question, Anders. And to some extent, we should be able to do that. But I think that just the essence of the Government business is that it's somewhat volatile. We don't control exactly where the cargo is going. It could be changes on short term. So it's not -- it's very different than the commercial business with regular moves all the time. This business is -- fluctuates more. What we see and what we hear from our partners is that the activity level will remain strong going into next year. But whether that is Q1, Q2, I think that's too early to be too concrete on.

Then on to something that we kind of shed some light on this quarter, which is the digital transformation. We mentioned about $10 million a quarter, which is a meaningful number. What exactly does that entail in terms of what are we doing?

Yes. Well, we're doing a big overhaul of the backbone of how we operate. And I think it's fair to say that we have been doing well at the back of a data and digital infrastructure built 20 years, 30 years ago, but it's not been fully connected, and there is enormous room to improve that. And also for us to use the -- and benefit from the effect of new technologies, including AI, we need a better and common data platform and how we're making sure that all the data we have is connected. We need to connect our own systems better. We need to digitize more of our processes. We need to standardize more of our processes, and we need to deploy technology to drive efficiency and scalability.

It sounds like nice words, but what does scalability mean? That means that for every new site we add into logistics, we are reducing the cost of operation for the total operation by adding that. Today, because we have less efficient systems, we are adding complexity and we're adding cost. So this is really about simplifying, standardizing, automating our processes and digitizing whatever we can. And we have a major effort on that starting last year going into '26 and '27. And we have called that program Wall Wil '27, and we think we will be in a good position in the year or 2 forward.

Then there are a number of questions around how do the book of business distribute, but we haven't shed any light on that, and I guess we are not going to do that either.

Thank you for saving me.

So I just need to have a quick look here so that I think we have addressed most of the questions. Bear with me for a second. It seems like we have addressed most of them. But if you were to sum up Lasse, where do we stand? And how do we look going forward?

I think Wallenius Wilhelmsen is extremely well positioned. We have customers that are depending on the global scale we have, the network on shipping, our ability to help them in destination logistics, Chinese players growing fast, they need all the help they can to scale their destination logistics. We are also investing into new areas of helping them with digital services, and we have a unique position in the government business. So we believe that in all our areas, we'll have strong demand. We need to improve our underlying results in logistics. But in general, 2026 will be another strong year. And let me remind you that we are sold out. And if the Chinese story continues, we believe the whole shipping fleet in RoRo will be sold out in 2026.

And I've got a kind of reminder here. Is there any questions from the audience?

Yes.

Anyone? It seems not.

Maybe they chatted.

It could be. I guess that sums it up.

So thank you all for joining. Thank you for joining online, and see you soon.

Good morning, and a special welcome to everyone here in the audience. Also a warm welcome to everyone watching us online from all over the world. I'm here with Anders-Redigh Karlsen, who is our Head of Investors. So Anders, I will start with you. What can we expect today?

I guess another good quarter is basically what we're delivering. So it's a bit boring, but -- it's good.

It's good. And we will do the usual drill. We'll very soon start with our CEO, Lasse Kristoffersen. He will do the business update. He will be followed by our CFO, Bjørnar Bukholm, who will do the financial update, and then Lasse will conclude that part. And then, Anders, you will run the Q&A session.

Yes. So if you have any questions in the audience, we will open up for that. But also on the webcast, please post your questions in the Q&A session of that, and we'll address those questions as they come. And do remember, it takes a little bit of time before they arrive. So put them in ahead of time rather than later. So...

Good. Then we're ready.

Then we're ready.

And then, Lasse, the stage is yours.

Thank you. Good morning, and thank you for tuning in and listening to us. I will jump straight to the headlines and then take you through some more details afterwards. So all in all, as I said this morning, we are delivering another strong quarter and adjusted EBITDA of $471 million, that is adjusted for a sale of a vessel. We still see that there is strong demand for our services and, in particular, the growth out of Asia continues, and I'll come back to that to some detail.

We're also growing our network in logistics. We are partnering with more customers in logistics, and we're proud to announce that we opened 3 new facilities in Australia in the quarter. I'll come back to that, too. We sell the vessel with a gain of $16 million. And then, of course, as most have heard, in the quarter, there were announced port fees in the U.S. They were increased for what we thought was $14 to $46 per net ton, and that has an impact on our operation, on our customers and possibly on our financials, and I'll come back to that.

But if you look at the underlying business, that is still strong. We're expecting another strong quarter in Q4, in line with Q3 before we take into account any effect of the U.S. port fees. So all in all, Wallenius Wilhelmsen is performing well. We're delivering well on most parameters, and we also expect to do so in '25 and into '26. So let me then give you some updates on the market. I'll talk you through some highlights from the business and the quarter, and also touch upon sustainability as we always do in the quarterly presentation.

Three themes for the market review this time. I will share with you a little bit more about the growth and where does it come from and what can we expect going forward possibly. I will touch on both the tariffs and the U.S. port fees and also the utilization and the balance in the market. So let me start with the overall demand. Deep sea volumes are increasing and are expected to increase in pure volume this year with 3%. And these are in most trades, but there's no doubt that the general trend is that the growth comes out of Asia, that continues, while the volumes going back to Asia, principally out of Europe and the U.S. are reducing.

So this is what we have alluded to earlier that we are seeing an increasing imbalance in our business, meaning that we are fully loaded vessels and we have full utilization, and we allocate all our capacity that we can out of Asia, but we're not able to fill up the vessels going back as much as we have done in the past. And the story out of Asia, the growth story out of Asia is China. And as you can see, China have seen a massive growth in exports of cars over the last few years. And since 2021, they have had a CAGR, an annual growth of 33% every year, and they're approaching close to 6 million cars, maybe 5.7 million cars exported this year.

If you look on the forecast for '26 and '27, and we use S&P as our main source for that, they believe that the export will fall into '26 and into '27. We are challenging that assumption, and I'll share with you a little bit why. And on the right side of this slide, you can see that there are quite some achievements made by Chinese car manufacturers. And I think we need to start rethinking why do the Chinese car manufacturers succeed. Historically, China was a cost arbitrage.

Western OEMs moved production to China to reduce cost. Then there were Chinese OEMs coming online with a cost advantage. Now the reason why Chinese are winning market shares is because they innovate themselves. And if you look on the left side of this graph, this is a third-party assessment of technology leaders in the industry. And as you can see, we've taken out the names for sensitivity. But as you can see, out of the top 5, 4 are Chinese. That means leading in technology, and that's EV technology and drivetrain technology, but not least, digital computing and the cloud technology.

So the Chinese producers have gone from being cost leaders to now being technology leaders. They are also many of them fully integrated end-to-end and have full control of their supply chain, and they have their own developed computing capabilities. So we believe that the Chinese competitive advantage in the car market is still there. We expect that to grow. And our base case is not that China will -- exports out of China will reduce over the coming years.

And then last comment on China. We cannot think of China as one thing. In China, you have -- I mean, you could very simply talk about China in 2 ways. One, you have established OEMs already at scale, not being technology leaders. They are at the bottom of this slide. And then you have new players not at scale yet, but are technology leaders. They are typically at the high end of this. So some of these players need to get to scale to survive, but they are growing fast. And that's why we are focusing in a lot on being a partner to these Chinese companies.

And this is where Wallenius Wilhelmsen comes at its best. If you're a new started OEM, you are starting your exports, you need presence abroad. You need terminals, you need shipping, you need processing, you need distribution, and we're a one-stop shop, and we are quite unique in offering that to the Chinese market. The other key story, of course, in the quarter are the tariffs. One are the tariffs on the cars. And just to put this into perspective, the tariffs on cars have an effect of maybe $4,000 to $6,000 per car imported into the U.S., while the port fees have a cost of maybe $200, $300 per car. So these are very different nature.

The problem is that the last comes on top of the first. And of course, this comes also on top of OEMs that are struggling with their performance, with their market shares and also with their financial performance. Generally speaking, although it's not fully implemented and carved in stone, it seems like we have come to a conclusion. U.K. is concluded. EU seems to be concluded as well. They need to approve it first, but that is expected to happen. And both Japan and now Korea has confirmed 15% tariffs. And then there is still uncertainty where we will end on Canada and Mexico. But what you will see later on is that, that export still is strong.

On the other hand, on the USTR, that was announced on -- I think it was October 10, and then it was implemented on 14th. And remember, 13th was a day off in the U.S. So basically, the day before implementation, this was announced. And we might have been the first company in the world paying a port fee. We did that on the 14th of October. There are some exceptions to this, U.S.-owned U.S. flag vessels, we have some of them. And also, we can mitigate through different measures. One is that there is maximum 5 -- I mean, you can only get 5 port fees a year on the vessel, meaning that if you are circulating vessels more than 5x into the U.S., you can get an exemption for the last entries.

Then last week, there was an announcement that this -- the whole scheme will be postponed 1 year. We have not seen anything confirmed. We have not seen any details. And I can assure you we have made quite a few calls to figure out. So this is not confirmed and concluded yet, but that can happen anytime soon. But until that, we are assuming that these port fees are here to stay, and I'll share with you later on a little bit of the effects of that.

Generally, in the U.S., there has been a strong sentiment on car sales. So the import tariffs has not changed the appetite for new cars in the U.S. The recent growth is probably driven a lot by the end of EV incentives, but still, there are quite a good level of sales in the U.S. And we also see now that the production in the U.S. is starting to pick up. We're not on historic peaks. We're still below historic highs over the last few years, but we are seeing that domestic production is growing somewhat. While on the import side, we see different markets performing differently.

In general, you can say that the Mexican and Canadian volumes and the Asian volumes out of Korea and Japan are more or less flat. They have decided to keep on pushing for market share and delivering volumes to the U.S. and have not really taken any stance or stop when it comes to the tariffs. The opposite is the case for the European OEMs. As you can see, throughout the year, they have been declining in volumes into the U.S. And this is a trend now that maybe recent months have started to stabilize, but still they are significantly down from what we saw last year. So the loser so far in market share has been European OEMs in the U.S. market.

Last item I want to touch on in the market is the fleet utilization and also the newbuilding deliveries. As most will know, there is quite an extensive order book in the RoRo segment. That is starting to deliver. This year is the, call it, the strongest year, the highest year in terms of deliveries. We also have another year next year where there will be more volume coming in. But the update so far is that we are still seeing high utilization, and we have not yet seen a direct negative effect of the new vessels coming in.

And to the right, you can see Clarksons assessment of fleet utilization. And in '25, they're still expecting 96% utilization. And then when you see the 100%, of course, that's a theoretical max, but the reality was that for the last few years, the demand has been higher than supply, and that has caused a lot of cars to go into containers. We see that is coming back now. So in reality, we have had a utilization well above 100%. Even though we have a lot of vessels coming in, according to Clarksons, they expect utilization close to 90% over the next couple of years. Historically, that is a good utilization of the fleet.

So if you look on the market assessment, there is not going to be a massive reduction in fleet utilization. And through that, you can expect the market to hold up somewhat. There's no doubt that we are beyond the peak. If you look at the more spot numbers on freight coming out of Asia, they probably peaked a year ago, but they are still historically strong. So as you can imagine, there's quite a few things happening around us, and we have here just shown you what it's like to be global infrastructure. Wallenius Wilhelmsen, we are global infrastructure. Whatever happens in the world hits us.

And the good news is whatever happens in the world, we're able to manage. And I will not take you through all this, but as you can see, there have been massive disruptions in ports, in trades, in tariffs, now in produce, but we are able to manage through and as you can see, an amazingly strong and stable financial performance throughout these things. And this is due to a couple of things. One, we have a fantastic book of business. I would claim, and that's my claim, that we have the strongest book of business with the best customers in the industry. I think we have the best team being able to adapt to whatever happens.

And I can assure you with something happens like USTR, Wallenius Wilhelmsen is at its best. And then last but not least, we have a global presence across the full supply chain. So we're an integrated part of our customers' logistics, and they need us to deliver. So that leads me into the performance for the quarter, and Bjørnar will give you more of the numbers. I'll give you more on the business side. Very briefly, you can see we have a relatively stable performance throughout the years. Strong performance in both Shipping and Logistics, and Government. And all of them are -- well, both Logistics and Government are slightly up, while Shipping is marginally down. I'll come back to some of these factors that has caused this.

We are continuing to add to our book of business with the contract negotiations ongoing and what we expect to renew this year, we expect 2026 to be another sold-out year. We have added around $300 million of contracts in the quarter. And we have now a total book of business on Shipping on $7.8 billion and a duration of 3.4 years. And on logistics, it's around $3 billion. So when I talk about our book of business, this is our book of business. This is what we're going to live off in '26 and into '27. Very little of what we do will be short-term spot market cargoes. But of course, we do that as well.

On Shipping, we saw a slight decline quarter-over-quarter. That was due to somewhat lower volumes. And there were a few reasons for that. One is that our biggest customer in Korea, HMG, they had a strike for a few little periods, so they had somewhat lower volumes. And also the fact that we have less volumes going east from Europe and North America, meaning that the total volumes are decreasing, although we're completely busy and have full vessels going west.

And on volumes, we also see that we have probably passed the bottom on the High & Heavy. And for those who don't know High & Heavy, that is excavators and harvesting machines addressing mining, construction and agricultural industries. We see that agriculture is still weak, mining, still strong demand, and we are now seeing signs of somewhat recovering in the construction sector. So we are not expecting the High & Heavy volumes to go up fast or steep, but we do think that the bottom is behind us. So what countered the lower volumes in the quarter was somewhat higher rates.

Quarter-on-quarter, the rates are more or less stable, and you should expect, there's not big things happening. But if you look year-over-year, you can see that we have been able to reprice our book of business, adding close to $2 per net ton in terms of higher rates. And also, we see that we have more trades out of Asia, which pays better than the return cargo from Europe and North America. We have also done some transactions in the quarter, and I wanted to bring this in to show you the value of the book we have on vessels. We have sold vessels with good book value margins.

But also we have a significant portfolio of up to 11 vessels on time charters where we have purchase options or purchase obligations, all of them largely in the money. So there is quite a lot of value hidden in our time charter book that we showed some of that value in this quarter, where we declared a purchase option for a 15-year-old vessel below $15 million. And at the same time, we sold 2 vessels, 30 years-ish for a total number of $40 million. So basically, we're buying half the age for less money. And we have plenty of more of these opportunities going forward.

Quickly on the U.S. port fees. We are maybe the biggest player on the U.S. market. We're certainly one of the biggest, but we believe maybe the biggest player in the U.S. market, significantly bigger than other players out of the same region, let's say, Norway. So we have shared now the numbers and what is our exposure. And our exposure this year is expected to be up around $100 million. These numbers are not accurate. As I said, this just came to the market. We don't know yet how many calls we will have and when they will hit the U.S. and so on. But in the range of $100 million, that's our exposure.

Next year, the total exposure, in other words, in theory, what we can be exposed to paying in fees is somewhere between $350 million and $400 million. So you can imagine these are substantial numbers for us. And then the big but is, of course, we are working actively on reducing this bill. We know we will do that. We know that we will not be in $350 million to $400 million in actual cost next year, but we don't know how much we can mitigate. And on top of that, we are working together with our customers for them to recover these costs for us.

And our target is to recover all of these costs, minimize the cost as much as we can and then recover what's left with our customers. It's hard for us to say how much we will succeed and where we'll end. But so far, we see strong understanding from our customers that this is something that we simply cannot carry and a cost that we have not brought to our customers.

On the Logistics side, we see somewhat increasing performance. I'll start at the bottom because that's the main reason. We have strong performance in our terminals. In general, we see good volumes and good activity, except for 2 things. That's the auto side in the U.S., which has been a little bit softer and also in the High & Heavy, in particular, in the U.S., where we see that the market currently is soft. But generally speaking, we see strong volumes, high activity in the logistics sectors and also increasing margins both on the auto side and on the terminal side.

While on High & Heavy, the margins are falling, and that's basically because we have much more storage than we have actual processing, completing of equipment where -- and that's really where we make our money and that's where we should make our money. I told you that we are growing our business. We have previously shared that next year, we will start up in Gothenburg with the terminal. We have shared that we are likely investing together with Bertel O. Steen in a new facility in Drammen. This quarter, we opened 3 new facilities in Australia.

We are, generally speaking, one of the leaders, maybe the leader in the Australian market, both on shipping and logistics. We have grown tremendously over the last few years, and that will continue. And in the quarter, we made a major breakthrough with a very fast-growing Asian car producers. And then you can imagine where they come from, but I can't tell you. And we are now doing their shipping. We are doing their processing, meaning finalization of cars in Australia, distributing to dealers.

We're basically their supply chain out of their call it, manufacturing country into the Australian market. And this will add somewhere in $25 million to $30 million worth of revenue that contract alone per year, and we see further growth opportunities with new players coming in. And to us, this is a very good example on how we are uniquely positioned with growing OEMs that need help to establish an overseas presence and also to get to overseas markets with shipping.

Quickly on Government service. This is how our business volume and our commercial volumes comes in. So the majority of what we do are U.S. flag required business, meaning government moving cargo, requiring a U.S. flag to move it. Then we have income from the stipends, the stipends, meaning that we have support from U.S. authorities to run on the U.S. flag. And then there's an element also on top, which is the commercial cargo, meaning the cargo that the government business gets from the rest of the Wallenius Wilhelmsen system, normal cargo.

And as you can see, we had a good development in terms of volumes and revenues into this quarter, although somewhat down from same quarter last year due to a technicality with U.S. activating one of their reserve fleet, which we believe will come back to rest soon. So in general, we would say that the Government segment is performing well, and we see high demand of U.S. flag cargo.

So before I pass to Bjørnar, let me touch on sustainability and every conversation in Wallenius Wilhelmsen starts with safety. And we have on top of our strategy to be a leader in safety, security and compliance, and I think we are increasingly getting there. We are never happy with our safety scores. We believe that we can avoid any accident happen, but we do see that what we do, how we work and how we invest in culture on safety helps, and we are improving our performance, and we are well below our targets for the year.

On emissions. We are also doing well on the stuff we can control, meaning the emissions per, call it, nautical mile we're traveling. Although due to the increasing imbalance, we have less cargo on our own voyage, meaning that we have higher emissions per cargo units. That's the EOI on the right-hand side. The absolute emissions are going up, but that's simply because we have more activity. If you look at the emission per vessel per nautical mile travel, it's down 0.1%, and we'll be consistently reducing our carbon footprint and increasing our energy efficiency for quite some quarters and years in a row.

With that, Bjørnar, the numbers.

Thank you, Lasse, and good morning, everyone. It's great to stand here today for the third quarter and really, really seeing the consistency in our performance despite the market turmoil and the numbers we are showing and really, really impressed by the organization and everything that we're actually able to deliver in such challenging times. So with that, let's look at the numbers.

Revenues came in at around $1.3 billion. It's down 1% quarter-on-quarter, largely driven by the Shipping segment, and we had lower fuel cost surcharges and also slightly lower volumes on seasonality. If you compare to the same quarter last year, also volumes down -- sorry, revenues down 1%. This is driven by the sale of the MIRRAT terminal that we sold in April this year. EBITDA came in at $488 million, 3% up quarter-on-quarter, but that also included an exceptional item with the sale of 1 vessel, and we had a gain of $16 million and that vessel was delivered to her new owners in the third quarter.

When we adjust for that vessel sale, we had an EBITDA -- adjusted EBITDA of $471 million. That's on par with the previous quarter, slightly weaker contribution from the Shipping segment and then somewhat better contribution from Logistics and the Government services. When we compare to last year, there is a drop of around $30 million. $20 million is explained by underlying slightly weaker contribution for the 3 main segments and then $10 million is explained by the MIRRAT terminal that we had last year, but we didn't have it this quarter.

Moving over to net profit, $280 million. Adjusting for the sales gain, it's $263 million, which compares to $268 million in the previous quarter when you adjust for the $135 million sales gain from the sale of the MIRRAT terminal. It's slightly down quarter-on-quarter. This is explained by taxes. We had higher tax expense in this quarter as we upstreamed cash or took dividend from our operations in EUKOR in Southern Korea, and then we need to pay withholding tax. That was $6 million. That explains the difference. So very, very stable quarter-on-quarter and also comparing to last year, $259 million. So very, very stable performance in a challenging market environment.

Moving over to net debt. Our net debt position increased by $150 million in the quarter. This is explained by the dividend of $465 million in the quarter, partially offset by the very strong operating cash flow we had in the quarter and had for many quarters in a row.

Moving over to the financial targets on the right-hand side. Again, very pleased to see that we delivered a return on capital employed in the area of 19% to 20%, nearly 2x what we have over the cycle long-term target of 12%. Stable equity ratio at 40%. Leverage ratio remains at around 1x. And then our liquidity reserves at the end of the quarter was $1.7 billion. And note that this also includes undrawn credit facilities that we have with our core banks. Then some details on the Shipping side.

Revenues came in just north of $1 billion. It's down 2% quarter-on-quarter, largely explained by lower fuel surcharges due to falling bunker prices. Then as Lasse commented on seasonally somewhat weaker volumes, factory shutdowns in EUKOR, a strike with our key customer out of Korea, but this was partially offset by net freight rates being up 1% compared to the previous quarter. But please note that this was due to trade and customer mix. The underlying prices to our customers is relatively stable, so no repricing effect in the quarter. If you compare to the same quarter last year, it's basically flat, very, very stable. Volumes slightly down, rates are up.

Moving over to adjusted EBITDA, $407 million. It's down 1% quarter-on-quarter. A couple of reasons for that. One is slightly lower volumes. The second effect is a retroactive charge of $12 million related to increased stevedoring cost in the U.S. following substantial rate increases in certain imports, double-digit rate increases in percentage terms. So this is actually dating back for the last previous 11 months. So it's a one-off hit in this month. Recurring cost going forward on a comparable basis around $1 million extra per month, certainly not $12 million extra per month.

Then we also had a negative effect as the fuel surcharges went down $21 million, but our fuel cost only went up $15 million. Over time, we are fully covered more or less through our bunker adjustment factors. But from quarter-to-quarter, there may be swings as the bunker prices are moving up and down. Compared to the same quarter last year, we see also that our EBITDA is slightly down. This is related to volumes, partly offset by net freight and then we had this, let's say, extraordinary items in the quarter on the cost side.

I know some of the analysts has picked up on the vessel cost actually was down in the quarter. This is also largely explained by a one-off event that we got a recovery of $3 million on damage repairs in the quarter. It's relatively -- underlying it's relatively stable on the vessel OpEx. But all in all, a good quarter on the shipping side.

Moving over to Logistics. Revenues flat quarter-on-quarter. If you adjust for the sale of MIRRAT, we actually see that revenues are up in the quarter. And if you compare with the same period last year, yes, it's down 7%. But if you adjust for the sale of MIRRAT, it's largely stable also compared to last year. EBITDA came in at $34 million. It's up 6% quarter-on-quarter due to the strong performance for the terminals. If you adjust for the sale of MIRRAT, we actually see that result is up 10%.

If you look at the various segments in our business, we continue to see that the auto business is performing below our targets. That is driven by the U.S., while we see that our operation in Canada and Mexico and Rest of the World is doing well. Similarly, on the High & Heavy side, we have a big footprint in the U.S. The High & Heavy market in the U.S. has been sluggish. We are seeing some signs of recovery, as Lasse mentioned, but for now, this is impacting our results in the U.S. For other parts of the world, we see that the performance is relatively good.

Terminals, that was the shining star in this quarter. Even without MIRRAT in the quarter, we actually had $3 million better performance from the terminals in this quarter. Part of that is related to underlying strong performance across all of our terminals and then part of it related to specific events. We had some price increases in Southampton with effect dating also back in time. And we had a government grant for our terminal in PIRT in South Korea. So helped to boost already strong results on the terminal side.

Moving over to Government Services, where we continue to see that the activity level is good. The results are solid. Revenues were up 6% quarter-on-quarter. That was driven by seasonality. Q3 is typically a stronger quarter seasonally for the government U.S. cargo that we carry. When we compare to last year, our revenues were actually down $5 million. As Lasse pointed out, this was due to a specific event with some of the cargo that we typically carry was carried by a government-owned vessel. We expect that to be a one-off event. We typically don't see this type of reactivation of older vessels.

This also impacted our EBITDA in the quarter when you compare to last year as we were missing some revenues that we expected to carry and we had the capacity to carry those volumes. But still, we see that EBITDA of $44 million, it's up 7% compared to the last quarter, and that is due to the seasonally stronger volumes despite losing out of some volumes that we hoped to carry. But all in all, Government Services continues to perform very, very well.

Moving over to the cash and liquidity position. It remains very, very solid. At the end of the quarter, we had a cash balance of close to $1.1 billion. It's down 21% quarter-on-quarter due to the dividend payment of $465 million during the quarter, and then we have also done some voluntarily repayment of our debt during the quarter. Operating cash flow, $482 million, with a stellar cash conversion rate of more than 100%. Some of you may ask, how is that possible with more than 100%. That's a technicality into how we calculate it. We calculate that adjusted EBITDA versus the operating cash flow and not EBITDA versus operating cash flow. So that's purely a technicality, but it's very, very strong.

Investing cash flow, negative $23 million. So we have CapEx on our newbuilding program, and we have certain other CapEx, but then we had the sale of one vessel that partially offset this CapEx. And on the financing side, it's been a very eventful quarter, negative $740 million. Of course, a large part of that is explained by the dividend. Then we also had regular payments, our bank loans, our vessel leases and terminal leases. But in addition to that, we did $100 million or $98 million repayment on a credit facility. After that, we have no drawn credit facilities in the group, and we bought back $26 million in the bond maturing in March 2026.

Reason for doing this is that we want to improve our cash management and liquidity management and not having drawn debt when we have excess cash in the group, although some of the cash is not placed where we want it due to the relatively complex structure we have with EUKOR, government services, logistics and the traditional WW Ocean shipping side.

Finally, our balance sheet. As you know, we continue to have a very, very strong financial position, strong equity ratio of 40%. Moderate debt level continues, will continue. Leverage ratio remains around 1, and then we have liquidity reserves of $1.7 billion. It's down $200 million quarter-on-quarter. This is explained by cash down $300 million, mainly due to the dividend. But then the credit facility part is up by around $100 million as we repaid the only drawn facility we had during the quarter.

With that, I will leave it over to you, Lasse, for the outlook.

Thank you, Bjørnar. And I will make that short, and we have touched it already. Generally speaking, we see that demand is still strong, both demand for shipping and for logistics in general, there are some weaker signs of auto and High & Heavy in the U.S. But in general, we expect these activity levels to continue into Q4 and that we will have an underlying performance in Q4 in line with Q3. And that is before any effects of the USTR, and we have shown you a little bit of what that possibly could be, but we are optimistic that we will be able to mitigate and recover most, if not all parts of those fees.

And then we expect anytime soon any confirmation on whether they are still applying or not. Maybe already today, we will have news in that regard. We expect 2026 also to be another year with high utilization, thanks to a very strong book of business, long-term partnership with our customers. And then again, the uncertainty for 2026 is largely linked to the USTR port fees, the size if they apply, and also our recovery.

So with that, I'll stop the presentation and, Anders, invite for questions.

Just again, if you have questions, please feel free to post them in the chat on the webcast. We will start with the few ones. Lasse, you delivered a very strong Q3. Focus is now on the challenges for Q4. What's your thoughts around that?

Well, I think what we can control in our company are working well. And we believe that Q4 will be largely in line with Q3 and also that we will have another strong year in 2026. And then factors on USTR, we cannot control. But I would say this organization has been exceptional in the past on making sure that we have minimal impact of these events. We showed that on historic line. And we also believe that the impacts of the USTR will be manageable. So generally, our outlook for Q4 is in line with what we've seen so far this year, and we expect another strong performance into 2026.

Okay. One for you, Bjørnar. You're now a few quarters or 3 quarters into being a CFO. You came from the company previously, but what is your key takeaways from the current period?

Yes, I think that's a very good question. And I'll probably say it's a combination of 2 factors, if that's allowed. So I didn't expect and you didn't tell me, Lasse, that the world was going to be this volatile with tariffs, U.S. port fees, some customers struggling, some customers doing really well, a lot of capacity coming into the market. So I didn't really expect that. So thanks for that, Lasse.

But what I neither didn't expect that in this very, very special market conditions, the ability for Wallenius Wilhelmsen to deliver such consistently fantastic results with Q1, Q2, Q3 actually being exactly at the same level, plus/minus $5 million. And then you are saying, Lasse, that Q4 should be, give or take, in the same area before any potential impact...

You're telling me, Bjørnar.

We agree that Q4 will also be a good quarter before any potential impact of the USTR port fees. So that surprises me that so much volatility in the world, but Wallenius Wilhelmsen keeps on delivering.

Okay. We can start off with some of the questions from the audience. [ Jorgen Liam ] has some questions here. Firstly, he asked about our ability to mitigate and how can we mitigate the effects of the USTR port fees?

Yes. So the mitigation -- by mitigation, then he means how much can we reduce the fee before we claim it from our customers. And there are a couple of things we can do. As I mentioned earlier on, we can put specific vessels into strength, so we can have more than 5 entries during the year, then you are exempt. We also are in a unique position with having U.S. flagged business that we can -- that we're already using in our operations. And then also, we could do other measures.

So we make sure that every time we go to the U.S., we can have full vessels. And as you know, this is a cost per net tonne of the vessel, meaning that whether it comes in empty or full, doesn't matter. So if we can bring more cargo into the U.S. and not least more cargo out of the U.S., that would also affect it. So that's the 3 main areas. And then I think we have a list of 15 measures that we are looking at implementing and starting to implement to mitigate these costs.

He's also got a follow-up in terms of what can you share about our conversations with customers in terms of recovery?

We are fortunate. We have customers who consider us being their partners, and we consider them being our partners. And when things like this come up, we have to sit down and we have a good conversation. Those conversations are constructive. They are positive. Our customers largely understand that this is a cost we cannot carry. And then we're currently in the discussions on where do we land it, how do we do it? How much is it really. But I would say, generally speaking, we have constructive, positive dialogue with all our customers.

Finally, he's questioning our math skills. Our math skills.

Math skills, okay.

Yes, because...

That's probably your department, yes?

If we add up $100 million in Q4 in port fee estimates, we say $350 million to $400 million for the year. How do we make that?

I was hoping for that question because it's an elegant one. And was it Jorgen?

Yes, it was Jorgen.

I mean you could have figured this out, Jorgen, but I'll tell you. So the thing is that the port fees start to apply from 14th. So any vessel arriving from October 14 and later will pay a port fee. Quite a few voyages started before October 14. So for every voyage coming in before -- starting before October 14, when they get to the U.S., we pay a port fee. And then for every voyage that starts after October 4 (sic) [ 14, ] we need to take into account when you calculate the result of the voyage, the expected future port fee.

So you get the full port fees for the period from 14th of October until the end of the year, prorated for all the days we have. And then also, we have the addition of the voyages starting before October 14. So this represents more than a quarter or a short of a quarter of costs. I hope that was a good answer, but I was happy to...

Yes, I think that was a good answer. We shed some light on purchase options. What are our thoughts around those and what do we do about?

Well, of course, we're not sharing our commercial decisions upfront. We have some purchase obligations, meaning that we will buy the vessels, and we are happy to do so because they are very attractively priced. When it comes to purchase options, that's something we love. We love optionality. In a market with uncertainty, we can choose what we will do or not.

The good news is that we have options, which is far below the current market. And for some of these vessels, these are vessels in our core trades with core capabilities, unique capabilities. So we expect to have several of these coming in and that we will actually declare the options when they come due. But that depends, of course, on the market and the need at that time.

Okay. There was a follow-up on that as well in terms of our fleet, but it was related to newbuilds. Do we plan to order any newbuilds?

We have no plans to order any new newbuilds as of now. But of course, as a long-term player, vessels being 30 years -- trading for 30 years, and we are positioning ourselves for future competitive advantage. We always look at how can we develop our fleet. But for now, we're more than happy with the shape of program that will deliver 14 vessels. We will have the biggest, we think, the greenest and the most cost-efficient vessels in the industry. Half of them being 9,300 and the other half close to 12,000 CEU. And this will really put us in a strong competitive position in '26, '27 and '28.

Thank you. Next one is for you, Bjørnar. The question is, what do we plan to do with all our cash? And is the USTR port fees impacting our dividend?

So the boring answer is that the USTR port fees will not impact our dividend policy. When we set our financial strategy, I think we had clear -- 3 clear targets. One is we want to deliver stable earnings. Two, we want to have a moderate debt level. And three, we want to deliver consistent returns to our policy in line with the policy.

We are not changing that financial strategy and those policies because of the USTR port fees. The impact may be, if we don't recover all that, it will impact net profit. And if net profit is impacted, of course, dividends will be impacted because our dividend is based on 30% to 50% of net profit. But we are not changing the policy or the financial strategy.

Next one is on markets. First of all, what share of our cargo is linked to the U.S. We haven't disclosed that in a big way. So I think we'll keep that to...

You will stop me from answering. Okay? Yes?

To the fact sheet, but the second part is what are our expectations in terms of growth for the coming years.

Well, we -- as we alluded to earlier on, we believe that the growth out of China is more structural than just short term. So our expectation and what we position ourselves for is to grow with the exports out of China, both, of course, Western OEMs producing in China, but increasingly so Chinese OEMs growing out of China. This goes for autos, but also less noticed for High & Heavy. The growth out of China on High & Heavy is also very strong, both with foreign OEMs and Chinese OEMs. We think that will continue. And that is adding a lot of ton miles, and that's what matters for us.

And you can -- every marginal volume coming out of China requires a new vessel because that vessel does not have return cargo on the marginal counting, meaning that every volume coming out of China will need to be counted on demand on their own voyage basis. The vessel goes maybe all the way to South America and back. So that growth, we will think will continue. We see there's still good demand into the U.S. from Asia. So these key trades are still performing well.

We see growing demand coming out of South America, of the Middle East. So the big one to watch, of course, in our industry now is also the supply side of the equation. So far, we have not seen that, that has deteriorated the market balance, but that is to be considered going into '26. But in general, we have contracts. We see strong volumes, and we expect 2026 also to be a year of high utilization for us.

Okay. Next one goes back to USTR port fees and our calculation about for next year, $350 million to $400 million. What's the number of port calls and what's the average cost per vessel that is behind?

If you take the average typical vessel in the world fleet and not just talking about us, and we are not -- I mean, we're relatively similar. It's just north of $1 million, let's say, $1.1 million every time a vessel comes into U.S. territory, not every time we call a port, it's on time on every string as we call it. So one time when you get in there. So roughly speaking, the average will be north of $1 million. And then maybe we can challenge Jorgen back and then do the math in terms of the exposure and the cost per vessel.

The next one goes on customers and their ability to capture these costs on top of high rates. What are your thoughts around that?

There's no doubt that for quite some of our customers, this is a big challenge. Having said that, and I showed it earlier on, there's a zero indifference in terms of the tariffs impact and the port fees impact, but it comes on top of everything else. And if you look on, in particular, maybe European OEMs where they struggle with market shares in Asia, they are stating themselves that they are running quite some extensive cost-cut programs. Of course, this is a challenge.

Then you have other players maybe out of Asia and other places in the High & Heavy, certainly in the break book, where they don't really see this as a problem where we have already reached agreements. So in general, I would say that our customers, of course, are not welcoming these extra costs, but they are accepting them, generally understanding. And they are at the level that they will be able to accommodate, although there's a commercial agreement to be made with each one of them.

Okay. Then we have some questions about our book of business. Why is it down quarter-over-quarter? And why is there so few contracts being signed during the quarter? I think that's -- it's a relevant question, but it's...

This is -- we have quite some big contracts and some of them come due and some of them do not come due. I mean we had a major renewal with Hyundai-Kia. We have had major renewals with our biggest customers on High & Heavy and auto previously, and those contracts are going for quite a year -- quite some years. And of course, you eat 1/4 of that backlog every quarter. So unless you do all of these big things often, then you will see changes in the book of business. But generally speaking, we are -- wherever we are trying to renew business, we are renewing business. And if anything, we're growing in volumes with our customers.

Then there's a relevant question more on the composition of our fleet. What number of ships do we have that's U.S. flagged?

We have a total of 11 U.S. flag, whereof 10 are qualified under the MSP scheme.

Okay. There are also a number of questions here that are kind of -- we'll respond to those in e-mail later on because they're kind of very detailed. But here's the one. I think it must be an employee that's asking because Wallenius Wilhelmsen has a great reputation of being a great place to work. How will you describe your culture and your employees' dedication to transforming and innovation?

That's a good lead. Well, let me start with what I referred to earlier on. I think this organizations -- I mean, the commitment of our people, the competence of our people, the expertise of our team, I think, is second to none. The global reach is second to none. So when things happen Friday night, this organization mobilized over the weekend. Meet, work out and figure out how do we solve this USTR problem. And Monday afternoon, we had a plan. So I think I've never been in an organization being so agile in managing these -- all these things that get thrown on us.

And as you saw on the time line, we have had quite a few, but our performance is just rock steady. And then, of course, in a very volatile environment where we're really running after one challenge after the other, we're also trying to build a future-fit company. We are investing quite a lot into modernizing our technology. And we have said in our company that digital-in-carbon-out is core to our strategy. We will continue to do that.

So for those who work in Wallenius Wilhelmsen these days, we are trying to do 2 things: keeping up performance by making sure that we are keeping sales up, we have cost control and we are managing the yield of our assets. At the same time as we're running a big transformation program because we need to become much more digital, much more -- even more agile and much more data-driven to be successful in another 5, 10 and 20 years. And we've been around for decades, and we will be around for decades going forward.

There is another one on our fleet, and it's from Petter Haugen on our newbuilding options. Do we still hold any newbuilding options? And if so, when can it be delivered?

I don't think so. I have to look at -- can I get some help in the audience. I don't think we have newbuilding options on our hands, and that probably tells you that if we had, we wouldn't be very active in discussing them. But I must admit, top of my head, I don't think we have more options.

Yes. Then there's one from an investor saying that in our contracts with customers, do we have the ability to pass on these USTR fees? And if so...

It varies, and these are for lawyers to conclude, but we never start with the legal approach with our customers. We've been serving the likes of John Deere and Hyundai Motor Group and Mercedes for decades. We will continue to serve them for decades, and we want to find solutions together. So every dialogue with the customer starts with the relationship and trying to find a commercial solution.

And very rarely, we need to bring in the lawyers to figure out what does the contract say. And generally, I would say that our customers are understanding of this cost. They understand that we cannot carry it. And then there are still discussions on how and when and how much can they carry.

Questions are starting to run out. There is one about what information do we have around the postponement? I guess we said that quite clearly. We don't know.

And we need to act on confirmed granular information. We had not that last week, we had an indication that the intention is to postpone 301, and there's no doubt that, that's the intention. When we call the people -- senior people involved with this, they also tell us that they don't know yet exactly how this will play out. We do know that they are planning to come out with a specific guidance on this and ruling on this anytime soon, could even happen today. So -- but the general read is that the 301 is paused for 1 year until November next year. But until that is confirmed and what that implies, we are acting as if it's still port fees in the U.S.

Yes. Whilst we wait to see whether there are more questions, are there any questions from the audience? It seems to be -- yes, there's one back there.

My name is Lars. I'm a student at BI and just an investor in your company, really exciting to be here. You mentioned the expansion to Australia. I was just wondering what metrics do you use to make sure that it's demand driven and not ahead of the market or too soon?

Thank you for that question. And that's, of course, a balance you need to do every time. In this specific occasion, we had developed a plan on growing the auto side of the business, and we triggered that when we got a contract. So we have a contract now with a fast-growing Asian OEM that are securing us $25 million, $30 million worth of revenue into these processing centers already. We started in Q3 actually. And then we have set them up so we can grow more. We can have more customers coming in.

And we see that our unique integrated offering on bringing freight from Asia to Oceania, managing all transport in Oceania, completing the cars, making them ready and just for them to bring them to their customer is a unique offering. And many of these fast-growing companies ask for that specific integrated service. So I would say we have already a contract in place, but there is room to grow, and we expect that to grow.

Some additional comments or questions have come in. One is on our fuel consumption. Cargo volumes are flat, but fuel consumption is actually down quarter-over-quarter. How can we explain that?

Because we have invested systematically over years in energy efficiency. We do that on technical measures, changing bulbous bows. We're optimizing painting on the hulls. We have operational procedures, and we even use AI, as we have explained earlier on, to optimize speed on the vessels. So I'm extremely impressed with what the marine operations team together with ship managers are able to do.

And we have consistently more or less every quarter, we had a reduction in our energy consumption measured towards the activity level. And then the -- as I said, the emissions per unit transported goes up simply because we have less units going back to Asia, and you need to distribute more or less the same, but slightly less emissions on fewer cargo units.

Okay. Then there's one on logistics in Australia, slightly or a little bit of the same, but is our growth quarter-over-quarter on logistics entirely linked to the Australia operation?

No, it's not. And the Australia operation just started off in Q3, and we will see the full effects from Q4 and into 2026 of the new auto. So in general, we see very good performance in Canada. We see good performance in Mexico. You saw that export still is strong out of Mexico. Europe is a bit more volatile, but also some strong performance there. We have strong performance in Korea, in China. So generally speaking, if you take out the auto volumes in the U.S., also affected actually by the cybersecurity incident with JLR and the soft demand for construction machinery, in general, in the U.S., logistics is performing relatively good.

The remaining questions are mainly things that we can address via e-mail. So it's something we'll do. Summing up, Lasse, what is your thoughts around the quarter?

Taking a big -- slightly bigger perspective. As you saw on this graph, we're global infrastructure. Wallenius Wilhelmsen is hit by everything that goes on in the world. Despite that our performance has been very strong and very stable for many quarters. And this is what we also expect going forward. And then the uncertainty now lies with how can we recover and minimize the cost of USTR if that scheme remains.

But we are still expecting strong demand. We have a strong book of business, and we are writing new business at the moment, which have very strong earning potential in it. So generally speaking, we're in a good shape. We expect the underlying performance to continue as we see it today. But of course, being a global infrastructure, there's always uncertainty.

Thank you.

Thank you.

Good morning, and welcome to our quarterly presentation. It's great to see so many people here today, a warm welcome to all of you, and a warm welcome to all of you watching us online. So Anders, what can we expect today?

Well, I think we're going to hear how we have maneuvered in a volatile world, and we'll get an update on the results for the quarter.

Very soon, as usual, we'll start with our CEO, Lasse Kristoffersen, who will take us through the market and also how we have delivered this quarter. He will be followed by Bjørnar Bukholm, our CFO, who will take the financial highlights. Lasse will then be back and as usual, again, take the market outlook. And then Anders, you will take the Q&A session. So what do we need to know about that?

Well, for the online audience, please post questions in the Q&A box. Be wary, it takes a while for the questions to arrive actually in the digital world. So posting as early as you can in order to make sure that we can answer them. And there will also be a possibility to answer questions here in the audience and we'll send around microphone.

Perfect. I think we're set then. Are we?

[ For sure ].

So with that, Lasse, the stage is yours.

Thank you. Good morning, and welcome. And I must admit when I got up this morning and thought about this presentation, I was a little bit surprised by the fact that how fast we forget. Second quarter was maybe the most uncertain, volatile and in many ways, outlier in global economics and global trade. And there was a constant change in what was the reality was and how volumes moved.

And then looking back on how we have performed as a company, I must say I'm really, really proud of the team and the numbers we're going to present today, and we'll give you some more details of why we've been able to do so.

But starting with the headlights -- or highlights more importantly. We are delivering another strong quarter. One of the strongest quarters we have ever delivered in Wallenius Wilhelmsen, we have an EBITDA of $472 million, which is up 2% since the last quarter. And we see that the demand is still firm. We had strong demand during the second quarter. That continues into the third quarter.

We are paying a dividend of $1.10. This is in line with our policy where we pay 50% -- up to 50% of our net result. But we're also paying out the full proceeds from the sale of MIRRAT. And for those who don't remember, MIRRAT is a terminal in Australia that we have built up over the last few years. And that transaction shows the underlying values we believe sits in our logistics portfolio.

We also took note, of course, of the announced trade deals, but we are very firm in saying that these are not signed yet, and there are still some uncertainties on where they will land, but the fact that there seems to hover in around 15% is a very strong signal to our customers and at least reduces uncertainty.

Looking forward, we expect EBITDA in 2025 to be in line with 2024, and we expect 2025 to be another very strong quarter. And in this report, we're also updating that we are changing some of our financial metrics. Bjørnar will cover this in detail, both what we do and why we do it. But one noticeable one is that we have now set a very clear and upped our target in terms of return on capital employed to 12%. And this is due to the performance we have seen over the last few years and also the target performance that we have going forward.

So then, let me dive into some more details, starting with the market. What is really driving this around us and where do we see both headwinds and tailwinds? In general, the -- you could say that the demand for cars in the world, the production of cars in the world is muted. And most likely, we will see it a less number of cars produced or equipment produced in the world in '25 than in '24.

But still, there is growth in the deep sea, meaning that those who are further from the market are still relatively the winners in production. And we see this, in particular, out of Asia. And this is a story that is just continuing, mainly driven by China. The growth is for sure coming out of China, both on autos, but also on High & Heavy. And then that is supported by a quite firm at least flat and somewhat up also from other exporters in Asia. And both Korean and Japanese OEMs are performing relatively well in the year and in the quarter.

While the Western OEMs, in particular, the Europeans have seen their competitiveness falling over quite a while. And for the European OEMs, there's kind of a double whammy in the quarter. They have, for a couple of years, seen that their market shares in China are dropping. And remember, 1 out of 3 cars in the world are sold in China. Roughly, you can say 1 out of 3 stores all in China, 1 out of 3 is sold in Europe and U.S. together and 1 out of 3 in the rest of the world. That's the market. So losing significantly market shares in China is critical for European OEMs.

Adding to that, the increased uncertainty in the quarter from the tariffs into U.S., really created a [ hammock ] for European OEMs. And some of them even paused exports, some of them delayed exports, and that meant that the volumes out of Europe are both on a structural down, lack of competitiveness but also on a cyclical down or volatility down in the quarter due to tariff uncertainty.

We have seen though that the activity out of Europe is now maybe trending a little bit up into the second half. We see that on the volumes in our terminals. We see that on the bookings forward out of Europe. So we might have the bottom behind us. But still, there is a fundamental difference in the competitiveness of Asian versus European and also U.S. car manufacturers. And this creates an imbalance in the trade.

So although in the previous one, you saw there was a marginal increase in deep sea, the increase comes out of Asia. That means that we need more capacity to solve that because we don't have the volume going back. So all the growth in volume adds extra demand in the market.

When we talked about tariffs, this is a quite, let's say, messy graph, but the main point here is to show on the right side of the 2 graphs that it seems now that we are zooming in somehow on 15%, 17%, depending on stacking or not on cars. But what has hit, the actual bill yet is only 9% because of delays in imports, time-to-market and so on. So we have not yet seen the effect of the high tariffs of '25. So this is now being worked into the market. So nobody knows the effect when we sometime probably end up around 15% if that's put also into ink. So we are quite careful in forecasting the effect of the tariffs because they have not really affected yet.

In general, you could expect U.S. production to go up based on following these policies. We have not really seen that. We are seasonally up, but we are down year-over-year. And this is relevant, of course, for our Logistics business in the U.S., where we are sitting at the back of many factories. And of course, as in any market, some producers are doing better than others. But in general, the production in the U.S. is, relatively speaking, a bit muted. And we have not seen a surge in those production volumes yet.

I think it's noticeable though that you can see that the production is very steeply down on what we call heavy and medium trucks. Those are for commercial use. So there is certainly a decreasing sentiment when it comes to more of the business-driven demand for cars, while on the private market, they're still strong, but it's down.

The fleet is growing. And it has been a theme in our industry for a while that quite significant amount of vessels have been ordered, which is true. What we saw so far this year is that close to 40 vessels have been delivered. Despite that, we experienced a very balanced market. And then we expect more or less the same amount of vessels delivered in the second half of this year. And then we're adding some more vessels going forward. But we have not yet seen a shift in the market balance due to new vessels being delivered.

So then when we take all this, the market around us, so how does that affect and how are we positioned as Wallenius Wilhelmsen? Well, we are a leading player out of Asia, and we believe we are very well positioned for the growth that comes out of Asia, and we are, for sure, winning our share of that business.

We have been able to manage the volatility in the U.S. We said in the first quarter that we saw a drop in revenues, but we were not able to adjust costs accordingly. Now we are seeing that those costs are coming down in line with activity level. And we're also able to shift capacity from the Atlantic into ex-Asia when we see volumes are slow. So the fact that we are global and truly global enables us to adapt to where the demand is.

And we still experienced a balanced market. And there's no doubt that the peak for rates are behind us, but we still experienced strong rates when we do short-term business in the market.

Jumping into the segments. Shipping ended at $411 million, which is one of the strongest quarters we have had on record.

Logistics seems to be very much down, which they are, but the main factor in terms of the reduction in EBITDA comes from the sale of MIRRAT. MIRRAT was a strong generator for us. The underlying business in Logistics is actually slightly up quarter-on-quarter, and Bjørnar will come back to this.

On Government services, there is quite some periodical effects. So don't look too much on the slower second quarter versus the first. Year-to-date, we were ahead of year-to-date last year. And we see strong demand for Government services out of the U.S.

Looking into the details on Shipping. Volumes were up in the quarter. And that was partly also supported by stronger High & Heavy volumes. I will come back to that. And we see that this is again driven by ex-Asia volumes and strong growth in ex-Asia volumes.

On rates -- no, sorry. Then back to more details on that, you can see that we have quite a steep incline in the volumes out of Asia. And largely speaking, this is driven by 2 factors: the growth of China, but for sure also our increased market share of Korean exports. As you might remember, we increased from 40% to 50% in the contract with Hyundai and Kia.

At the same time, we see that the volumes out of Europe are dropping, and this is partly due to lower exports and partly also due to a business that we have decided not to renew due to the terms in the business. But largely, this is driven by market demand.

I mentioned that we saw a quite steep rebound in the High & Heavy numbers in the quarter. We do not see this as a start of a rebound in High & Heavy. This is more periodization effects of some cargo being front-loaded, but also the fact that we have customers that are winning market shares.

And our biggest customer in High & Heavy are doing extremely well, and we see that their export numbers are strong, and we are carrying more or less all of those volumes. So this is more an underlying trend with some customers, but also a periodization effect. We do see, though, that our customers still repeat that they have strong confidence that things will improve into 2026 for High & Heavy.

And then in particular, in public infrastructure, defense spending, energy and mining.

On rates, we have more or less a flat development. If you look on the repricing, quarter-on-quarter, it's flat. Repricing year-over-year shows that the contracts rolled in this year is slightly higher than those last year. There is a small negative effect from customer mix, meaning that we, relatively speaking, had more volumes from lower-paying customer contracts in this quarter that typically equals out over a couple of quarters.

And then for sure, the trade mix shows that the rates are up. But this is important to understand that this is because we are doing relatively more out of Asia, better paid; relatively less out of Europe, less paid. But normally, we do this on our own voyage. So it's certainly not positive for us to have less out of Europe, but it certainly shows that we have higher net rates because we have more of the volume with a higher-paying cargo. In general, we would say that the net effect quarter-over-quarter is more or less flat, but certainly a positive development due to some reprice contracts since last year.

If you go to Logistics on volumes, I mentioned it earlier and also in the last quarter, we saw the volumes dropping in Q1. We were trying to adjust costs accordingly. We were not able to. We have been able to do that largely in this quarter. So you can see that despite more or less flat volumes, for instance, on autos, we have been able to increase our margins by taking out costs.

Still in High & Heavy, and we see this on the ground in the U.S. and other places where we have what we call EPCs, basically, production facilities completing High & Heavy equipment that the new equipment is moving slow. Storage is still high, and the flow is still quite slow when it comes to High & Heavy. Our customers and the dealers also see still no rebound in volumes. And that means that we also have a quite low volume on our processing.

On the Terminal, we saw a drop partly due to MIRRAT effects, but also for sure that we had slower volumes out of Europe and then into the east, particularly East Coast of the U.S.

We have added some of our information on contract and book of business in this presentation, and we will do that on a regular basis also going forward.

For 2025, if you can see on the left-hand side for Shipping, we are more or less sold out. And roughly speaking, we have, we're 90% covered for next year when it comes to capacity and volume. And this is completely normal. So we are not stressed by not having 100% now. There's constant renewals. And that showed all the way to the right.

So we are announcing our contracts above $100 million, but we do a lot of contracts below $100 million. So just in this quarter, we added some $300 million for shipping, none announced, similar for ship -- for Logistics, $200 million. So in this quarter, just by renewing business, winning smaller business, adding business here and there, we have added $500 million to our book of business. And this is normal business. This is normal procedure, and that's why you will not see them in big announcements. But we are quite firm that we will be able to fill that gap also -- at least, most of that gap into 2026.

The duration of our contracts are for Shipping. If you wait, if you have it based on net freight, it's 3.6 years while it's 7.8 years for Logistics. So we have a strong book of business. We're sold out this year. We have a strong book of business for next year, and it's growing, and we are constantly adding to that book of business.

A couple of developments in the quarter that's worthwhile noticing. We sold an old vessel, and we also exercised some purchase options, and these are very attractive transactions. The purchase options are well below the market. It's end of time charter deals. And we were able to sell an old vessel that didn't fit in our trading pattern anymore to current market rates, which are, in our view, quite sound.

Then we also announced in a quite exciting project. In a way, Wallenius Wilhelmsen is coming home to Norway. We are setting up a facility together with Bertel O. Steen in Drammen. This will be a state-of-the-art -- we think actually state-of-the-art in the world, but certainly in Norway in terms of processing of cars coming into the Norwegian market.

We are -- if everything goes as planned, we will start building early next year and be in full operation in 2027. We'll be in Drammen port. And this facility can process up to 35,000, 40,000 cars a year and will be most likely the best and the most modern entrants into the Norwegian market, and we're quite excited to do this together with Bertel O. Steen.

On sustainability, in the last quarter, we saw some of our safety statistics jumping. I told then, and I repeat now that this is based on very few incidents, and hence, we have big periodization effects. So that what we saw in this quarter was that it fell down significantly on shipping. And we are happy with the average performance we have on safety. And we are now continuing our positive trend of reducing our incidents, and we are working very actively with both safety management, but certainly also on safety culture. And this seems to be paying off.

On emissions, we are still doing quite well in reducing emissions on -- in terms of actual emissions from our vessels and the distance they sail. However, we do see that our EOI, meaning that the emissions per car, to put it simply, is increasing. And this is due to the increased trade imbalance.

So when we have 1 car from Asia going to Europe, and we have no car taking back, that single car needs to have the full emissions for the run voyage. If we have 1 car going west, 1 going east, each get 50%, meaning that, that structural imbalance increases the emissions per car. However, the emissions from the vessels are continuing to go down. The emissions on vessels, if you divide it by the tonne miles they do, are continuing to go down. And this is what we can control, and we work really hard in continuing that trend.

And then we also updated the market that we have for -- in our Shaper class newbuilding project. We have taken half of the vessels and made them ready for ammonia, meaning that we are putting in tanks that can do both LNG and ammonia. And we are also through that, being able to source LNG and bio-LNG. And through now having 7 of the vessels capable of doing methanol and 7 of the vessels ready to do ammonia and LNG, we're now able to tap into all different fuels of the future. And we think this is absolutely critical.

We believe that we need to be able to tap into all kind of biofuels in the short- to medium-term. That means biodiesel, bio-LNG, biomethanol and then the medium to long term into all e-fuels and that means ammonia, methanol and possibly others that we don't know of yet. And now we are well positioned to do so.

So with that, I'll leave it to Bjørnar to take you through the numbers.

Thank you, Lasse, and good morning, everybody. And also thank you, Lasse, for no jokes here because I was clearly not prepared for that this morning. Although I was thinking about it before we started, what can Lasse figure out today? But thank you, Lasse. Jokes aside, I will cover the financial update as last time.

Starting with financial targets. As Lasse mentioned earlier in his presentation, we have updated the financial targets now to better reflect Wallenius Wilhelmsen stand today in terms of financial performance and also the financial solidity of the company and also where we see that performance should lie going forward longer term.

On a high level, the changes in financial targets reflect that we have increased ambitions for returns, reduced leverage and improved management of liquidity. If we look into the details of the changes starting with return on capital employed, we have increased this from 8% to 12%, where roughly the first half of the change is explained by the change in accounting treatment for the EUKOR put call option that towards end of last year, the put option -- the price for the put option was classified as a liability on our balance sheet, hence, reducing capital employed.

The second part of the change is reflecting our ambitions for financial performance over the cycle and improved balance sheet management.

Moving over to the equity ratio. We have kept it unchanged at 35%. Leverage ratio, we have reduced from less than 3.5x to less than 3x with a clear ambition for the company to have a moderate debt level and solid liquidity reserves as this will allow us and give us the flexibility to invest and return capital also in softer markets.

Finally, we have introduced a new target for minimum liquidity of $1 billion, consisting of operational cash and RCF capacity to allow for quick decisions on investment needs, financing needs, et cetera. It's important to highlight that we don't consider the financial target as restrictions. This is rather aspiration of where we want to be, guiding principles.

Then moving over to the highlights for the quarter. And as already mentioned for Lasse, it's a new very, very solid quarter for Wallenius Wilhelmsen, and we are proud of the strong results.

Diving into the details, starting with revenues. Revenue stands at $1.35 billion, up a couple of percent compared to last quarter due to stronger revenues for the Shipping segment. Comparing to last year, largely stable revenues. Shipping is up while the Logistics segment is somewhat down.

Moving over to adjusted EBITDA, $472 million, up 2% quarter-on-quarter due to strong performance for Shipping, slightly down for Logistics and for Government. Compared to last year, there is a drop of $25 million. That is explained by the Logistics segment. I'll be coming back to that.

Very strong net profit, $403 million, of which $135 million relates to the sale of MIRRAT and a sales gain from that transaction. Adjusting for the sales gain, we have a net profit of $268 million, up 8% quarter-on-quarter with the improvement driven by the stronger EBITDA and somewhat lower tax expense in the quarter.

Net debt, $1.75 billion, that is up $90 million in the quarter. That is explained by the strong dividend of $524 million that was paid in April, partially offset by strong operating cash flow and also proceeds from the MIRRAT transaction that was received in May.

Moving over to the right-hand side, financial targets. Proud to present yet end of the quarter with return on capital employed on around 20%. Equity ratio up to 41%, up 6%, 7% on the back of the strong net profit. Leverage ratio remains below 1x and liquidity reserve stands up nearly $2 billion at the end of the quarter.

Moving into the specifics on the segments, starting with Shipping services, revenues of $1.033 billion, up 7% quarter-on-quarter, due to strong volumes, partly offset by somewhat weaker net freight rates. It's already shown by Lasse, volumes up 8%, driven by increased volumes out of Asia, partially set by lower volumes out of Europe.

Net freight rate, down 2%. That is due to customer mix. It's a neutral effect from repricing and the trade mix.

If you look at EBITDA, 411 million, 6% up quarter-on-quarter due to increased revenues driven by the volumes, partially offset by somewhat higher cost, mainly to carry additional volumes.

Looking at cargo expenses and other voyage and OpEx, which is typically the variable cost, increased by $25 million. That is due to more volumes. Then we also had vessel OpEx and charge expenses by a total of $4 million. That is due to 2 additional owned vessels during the quarter due to utilizing the purchase option mentioned by Lasse and then there's also somewhat more chartering activity in the quarter.

SG&A is up by $ 10 million. We had some additional project cost expenses in the quarter. And then we also had the effect of salary adjustments in the second quarter. But all in all, another very strong quarter for the Shipping segment.

Moving over to Logistics. Revenues came in at $273 million. That is down 3% compared to the last quarter. That is fully explained by the sale of MIRRAT.

Adjusted EBITDA, $32 million. It's down 12% quarter-on-quarter. Also here, this is explained by MIRRAT. If you adjust for MIRRAT, we actually had an improvement on EBITDA of $3 million quarter-on-quarter with improved performance for the Auto segment or the Auto business area and the High & Heavy business area on stable revenues but we were able to take out quite significant costs in the quarter that improved the margins for that business. And this is a continued focus area for Logistics area going forward.

Terminals came in flat, improved performance in the U.S. And in South Korea while the European terminals was somewhat softer, which is linked to the export volumes that is already mentioned by Lasse.

When we look at the development for EBITDA compared to the same period last year, we see a big drop. That drop is explained by MIRRAT, and it's explained by weak results for the Auto business area and it's explained by weaker results for the European terminals.

Moving over to Government services that delivered another very strong quarter, although somewhat down compared to the same period last year, but note that this is seasonal and year-to-date, we're actually performing better than last year. Revenues, as you can see, largely stable, both quarter-on-quarter and year-on-year.

EBITDA, $41 million, that is down roughly 15% compared to the same period last year and also quarter-on-quarter. The difference lies in the type of volumes that we lifted. So the cargo mix is impacting this. And we also have 2 extra vessels part of the fleet in this quarter, which were previously on commercial charter with other parties in the group, which is increasing the cost. But underlying results for Government service remains very, very solid.

Moving over to liquidity. Liquidity rate remains strong, stands at close to $1.4 billion at the end of the quarter. Yes, it's down close to 20% quarter-on-quarter, but that is due to material debt repayments and the dividend that I already mentioned.

Investing cash flows of $164 million positive due to the proceeds from MIRRAT, partially offset by CapEx of $64 million, of which $40 million is related to the newbuilding program.

Financing cash flow, negative $923 million, regular repayment of vessel loans, and then we also had a voluntary repayment of an RCF of $205 million to improve our liquidity and cash management. And then again, we had the dividend.

Quickly on the balance sheet and our solidity. I already mentioned this, so I will be brief. Equity ratio, 41%, materially up due to a strong net profit for the quarter. Net interest-bearing debt, $1.7 billion, slightly up compared to last quarter due to the dividend and then leverage ratio remains below 1x.

Liquidity reserves close to $1.9 billion, $1.4 billion almost in cash, and then you have RCFs undrawn of around $500 million. A few changes on the RCF side took place in the quarter. We terminated a facility in WW Ocean of $150 million. This was a short-term facility with limited value for us, and then we repaid $205 million for the facility we have in WW Solutions.

Moving over to dividends. Yesterday, August 11, our Board approved a total dividend of $465 million, equivalent to $1.10 per share for the first half of 2025. The dividend is based on 50% of the underlying profit for the first half of the year. And by underlying profit, you mean the profit, net profit minus the sales gain from the MIRRAT transaction. And then we had an added element linked to the full cash proceeds of use to $210 million from the sale of MIRRAT. So all in all, this represents around 75% of the net profit for the period compared to our dividend policy that indicates 30% to 50% of net profit, but with an opportunity to do extraordinary dividends if there is something special, which MIRRAT clearly is.

The strong dividend, we see that that's a testament to the very strong performance of the company and also the very solid financial position of the company.

Finally, a couple of words on the newbuilding program from a financial perspective. In the second quarter, we secured post-delivery financing of $300 million for 4 Shaper class vessels at very attractive terms. The loan is split in 2 parts. It's used $250 million term loan, which is green. Actually, the first one in our company, that is green, and then we have $150 million sustainability-linked revolving credit facility.

What the revolving credit facility actually do is that it gives us increased flexibility on drawings on the debt, which helps us to optimize our liquidity management going forward.

Tenor for the loan is 5 years from the last delivery -- from the delivery of the last vessel.

With this financing in place, we have attractive financing in place for 10 out of 14 Shaper class vessels, and they will manage financing for the remaining vessels in due course.

Over to CapEx. At the end of the second quarter, remaining CapEx for this program is roughly $1.5 billion, and we have paid $43 million so far. Lasse commented on the change in fuel for 7 of the vessels. That came into an additional CapEx of USD 80 million. That's especially the LNG tanks are very, very expensive, but it positions us much better for the future in terms of flexibility for fuel sources.

With that, I will hand it back to Lasse for further prospects.

Thank you. And let me just get to it. We are experiencing strong demand and utilization, in particular in shipping, and we see this continuing into the Q3. There is still a strong demand and a good balance in the market, and we expect 2025 to be in line with 2024. This is, as I said, driven by the growing exports out of China into basically all markets of the world, but the U.S. We expect that to continue. But we're also seeing some signals that European volumes might come up somewhat in the second half of this year.

We do not expect yet a rebound in High & Heavy despite the strong volumes we have. But coming into 2026, signals from our customers are strong. So we are maintaining a strong outlook for the year, and we believe 2025 will be another very strong year for Wallenius Wilhelmsen.

So with that, I ask Anders and Bjørnar back to the stage.

[Operator Instructions] First, Lasse, the market is good. How long can we expect it to last?

Well, the current market momentum is certainly continuing to Q3. And -- but with the current volatility, and when we speak to our customers, even they don't know what's happening in Q4, but we still think that this year will be a strong year. It's too early to call 2026. But the momentum that we are experiencing are currently continuing into certainly the third quarter.

And Bjørnar, you're paying out $1.10 in dividend just a reflection of how is that split up and why that amount?

Yes. Thank you, and thanks to the audience for letting me repeat a good message. So the way we are thinking about this is that we have the net profit, and then you consider what is the underlying net profit of the business, and that is what the business delivers minus the sales gain for MIRRAT. So we took 50% of that amount, which is in the upper end of our dividend policy, and then we added an element to that, which is the full cash proceeds of $210 million from the sale of MIRRAT that took place in the quarter, and that adds up to $465 million.

Yes. Thank you. We'll start off with questions from the audience, if there are any. Anyone? There seems to be no questions from the audience. So then we'll start with the questions from the web.

There is a question around our newbuilding program. If demand dips, what is our plans in terms of recycling of all the tonnage when new vessels are delivered?

Of course, we -- normally, we plan for running a vessel in 30 years. Now the demand has been so strong that we have decided to take a couple of vessels through that 30-year renewal in terms of class and run them older than that. But in general, I would say that we will probably see that vessels turning 30 are more candidates for scrapping going forward.

When it comes to a newbuilding program, this is to replace our core fleet where that makes us -- it kind of hits our secret sauce. Large vessels that can take, have huge flexibility on high & heavy breakbulk and cars, and these will create competitive advantage for us when they are delivered. We are very happy to get them in, but we have a huge need for capacity also in '29 and '30 and beyond. So this is a start of a renewal program. It's not growth. It's renewal of our fleet. And of course, when we renew our fleet, we will phase out old vessels as new vessels are being delivered.

Then there is another question relating to logistics. In terms of demand per region, how has that evolved? And they're asking for thermals auto and high & heavy.

Okay. That was many dimensions. Let me start then east and going west, demand out of China in terminals in logistics, strong. Volumes are going up on both Auto and High & Heavy, and we talk a lot about the Auto growth out of China, but the similar numbers are for High & Heavy. And we do some logistics activity there.

We are well positioned in Australia. We see growth in Australia. And we are now actually also entering. We've done a lot of more on the High & Heavy in Australia, and we're now coming into the Auto segment as well and growing with, for instance, Chinese players coming into the market.

In Europe, I would say it's a somewhat softer sentiment, both on High & Heavy and cars in the quarter and right now, and this is more due to uncertainty, but also some structural decline, but we see a bit less numbers, although the momentum has picked up a little bit into Q3.

In the U.S. and North America, it's extremely hard to say one answer. Some producers are doing extremely well. Others are losing market shares. For instance, in this quarter, I think if I remember right, GM gained 10% market share while some of the others lost 10% to 15% in volumes. So it's a very big difference in the U.S. But in general, I would say that the activity on the East Coast terminals are a bit softer. West Coast terminals are -- and activity is very full.

Canada is going extremely well. And I would say Mexico is going surprisingly well and delivering good volumes and numbers despite the uncertainty of tariffs.

Thank you. That was an elaborate answer. So on the fleet, there is a question around do we have plans to sell any additional older vessels? And how is chartering market? Are we looking at adding tonnage?

We are constantly looking at our fleet. And if we see that there is value in selling vessels, we will sell vessels. We have a book of long-term charters that are producing a good purchase opportunities for us in terms of options. We are utilizing those. We did in this quarter. We'll do going forward. We saw in this quarter, we had an opportunity to get a -- what we consider a good price for a very old vessel that was noncore. And if we see those opportunities, again, we will take them.

In general, we do not do long-term charters now. We do not do long-term TCs. We have the capacity we need, although we see that there are fluctuations in the need for vessels. So we do some short-term charters, but that's just sound for this industry. We saw for a while that, that market didn't function. Now it's functioning again, and we could typically take in a vessel for 1 voyage, ex-Asia or for 5 weeks or something like that, but no long-term chartering activity at the moment.

Okay. Then one for you, Bjørnar. On the increased return on capital employed, how much can be assigned to the put option and how much is reflecting the current market?

Thank you. As we split -- as mentioned, we basically split this in 2 parts of the, call it, the increase from 8% to 10%. That is based on the change accounting treatment for the put option, and then the second half is due to our ambitions for financial performance over the cycle and also improved balance sheet management. So 50-50 split.

Okay. Then on port fees, do you have any additional information on...

Unfortunately, not. What has happened is that there was another round of comments being collected from the industry. We added comments to the USTR, which is the body that runs this process. Nothing has come out of that yet. We have no idea of how we will conclude. But certainly, our aim is to make sure that we get port dues in the U.S. that are at least in line with other segments.

And if you remember well, car carriers were singled out as a segment where there were also proposed dues on non-Chinese-built vessels, which is not in line with the intention of this regulation. So we have added our comments, but we don't know the outcome yet.

Okay. Then a question on rates. In the quarter, we saw the trade mix -- or the customer mix actually having a negative impact on rates quarter-over-quarter, how that's expected to go forward?

Well, in general, there are always periodization effect. You could have -- if we, for instance, have quite some contract volumes in a quarter from 1 specific customer, that affects our customer mix. Over a year, this equals out. So the customer -- effect from customer mix shouldn't really add much during the year.

What we'll add to this year is that we are phasing in, and we're now phased in full in new contracts, for instance, with Hyundai, Kia at new rate levels. And we see the structural imbalance in continuing, meaning that you could be a little bit full by seeing that some net rates are increasing because you have less return cargo that takes down the -- that reduces the averaging out of lower rates coming from Europe.

But when we look at our book of business, we have very solid rates in all our contracts right now, and there is still historically strong rates when we do short-term business out of Asia, although, we are certainly not at the peak levels we saw a year or 2 back.

All right. Then there is a question on fuel. We opted to switch to LNG/ammonia for some of our vessels. What was the driving force behind that decision? And could you explain a little bit about how we feel about that and prices, et cetera?

There were -- the main rationale for doing that was to get access to all types of fuels. And if you look at the current -- at the design we had, we did not have access to bio-LNG, and we did not have access to ammonia. We believe that for the next 5 to 10 years, we will source significantly amount of biofuel. Biofuel, meaning sustainable biofuel that is not competing with food or anything else, but actually biowaste that you use for fuel. This will be a commodity that is in high demand, and we need to be able to source all type of biofuels. We do biodiesel today. We are already looking at biomethanol and now we can look at bio-LNG.

And more importantly, we believe in the future where we'll have e-based fuels, methanol or maybe eventually ammonia, and we want to be positioned to be able to capture also ammonia as a fuel on the Shaper class. So this is about preparing for optionality in the future and both for biofuels and let's call it, sustainable fuels.

Okay. Thank you. Then there is a question on fleet growth. You touched upon it in your presentation. But fleet growth is substantial. But how do you look at the demand side of the things? You touched upon it, but you can elaborate a little bit more?

Well, as the balance is still strong, obviously, demand has been able to fill the vessels that have been entered this year, close to 40 vessels so far. We see still a strong demand out of Asia. We do not speculate on how this was balanced out. But for now, we're still in a good balance. There is no doubt that there is a big order book coming online and that, for sure, that will increase the supply side, most likely faster than the demand side.

But remember, what drives our earnings is not short-term supply/demand. We have long-term contracts with industrial customers. As long as they ship volumes, we have an agreement on doing it on fixed rates. So the most important thing for us is not really the short-term growth in fleet. It's the actual ability for exporters to export cars. And that still looks firm.

Thank you. One again for you, Bjørnar. There are a few but not too many. It goes on the outlook. Is that including the gains from MIRRAT and vessel sales, et cetera? Or is it?

When we talk about the outlook, we are focusing on EBITDA and not net profit and certainly not extraordinary events like the sale of MIRRAT.

I think that was clarifying. Then on to something that we haven't talked about in a while, wind-powered vessels. Is that going to be a reality? Or is that still a fiction?

It is a reality. There are vessels out there that are using wind as a power source. If you ask my personal opinion, for sure, wind is massive energy source we will need to capture. However, it's not easy, and they're still in an early phase.

For Wallenius Wilhelmsen, we are still working on our Orcelle Wind project, which is an EU-funded project with a lot of partners to see how much wind can we actually capture on a vessel. But very specifically, short term, we are working on installing one big sail on one of our vessels. It's the pilot installation is soon up in Sweden, and we will put it on one of our vessels this year or probably the next.

So we are already working on harvesting wind, and we will continue to do that. And I'm sure that our fleet and the world fleet will find new ways, new technologies and better ways to capture wind, and it's going to be a major supplement for energy in the future. Most likely for most trades, for most vessels and for most ship types, it will not be the primary energy source, but it will be a very, very strong supplement.

Thank you. We're starting to get towards the end here, but a final question, is Chinese OEMs are building vessels? Is that a threat or an opportunity?

Well, in my view, it's an opportunity because we see that this is subscale. They don't have the organization. They don't have the size to operate what they need. And I think these were decisions made in the time where capacity was really, really short. So we expect that you will see a consolidation of the players out of China as we have done in other markets. And of course, we want to be part of being a strong player out of China. But we are not scared of our customers becoming our competitors. But of course, we see new competitors coming out of China being operators like COSCO. But we are ready to compete with them.

All right. If there are questions that haven't been answered, we'll try to answer them via e-mails and other means. But few words rounding off, Lasse, before we end the presentation?

Yes. As I started, I would -- we're nearly say I'm surprised of how well we've been able to do in a market that has been extremely volatile. Although we see now a good momentum. The momentum is continuing into Q3. 2025 will be another strong year. We are adding contracts to our book of business, unannounced contract worth $500 million just in the quarter. So we, in Wallenius Wilhelmsen, believe that we are well prepared for a future even though uncertainty is much higher than we saw a year ago. Thank you.