SFL Corporation's Q2 2025 Earnings Call: Unraveling Contradictions in Dividend Strategy and Hercules Rig Prospects

Dividend strategy and distribution capacity, Hercules rig operational status and future prospects, dividend strategy and stability, Hercules rig operational status and charter rate, dividend adjustment and financial strategy are the key contradictions discussed in SFL Corporation Ltd.'s latest 2025Q2 earnings call.



Dividend Adjustment and Asset Strategy:
- SFL announced an adjusted dividend of $0.20 per share for the second quarter.
- The reduction was driven by the Hercules drilling rig being idle and increased investment capacity from asset sales.

Fleet Renewal and Efficiency Upgrades:
- The company divested 57,000 deadweight dry bulk vessels between 2009 and 2012, and agreed to new 5-year charters for 3 9,500 TEU container vessels.
- This strategy is aimed at improving operational efficiency by replacing older, less efficient vessels with high-quality assets.

Liquidity and Investment Capacity:
- SFL reported a strong liquidity position, including over $300 million in available liquidity.
- The company plans to use this capacity for new investments and to redeploy capital from recent transactions.

Regulatory Compliance and New Technology:
- SFL has advanced its commitment to new technology, with 11 vessels now capable of operating on LNG fuel.
- This is in response to stricter regulatory demands aimed at cutting shipping emissions, positioning the company for organic growth.