Ocean Yield chief executive Lars Solbakken believes more sale and leaseback financing deals are possible during the ongoing pandemic.
But he warned that the Norwegian shipowner's own interest costs will rise.
"I think that...we have seen recently, although we have been very conservative due to the market volatility, that there's a number of opportunities for doing new deals," he said, speaking on the company's second quarter conference call.
"You can do that at somewhat higher returns than we have done historically."
He added that Ocean Yield may find slightly higher financing costs to fund projects.
"But marginally more improved returns will be expected going forward," Solbakken said.
He told analysts to expect "improved earnings" in the third quarter, compared to the second three months.
The company has 67 vessels wholly or partly owned.
Its 29 tankers make up the highest proportion of this total, with 16 bulkers making this the second biggest segment.
Refinancing coming up
Ocean Yield has a contract backlog of $3.2bn, with a remaining charter tender of 10.3 years, Solbakken added.
"We have a very modern fleet — only four years in average age — and this is very important, as it's important to have modern vessels in order to have low emissions," he said.
Chief financial officer Eirik Eide said the company has committed to $3m of scrubber financing for two of its ships.
He added that it has some debt maturity coming up in September relating to one of two tankers on charter to Navig8 Chemical Tankers.
"We are refinancing that at the moment and credit approval has now been obtained by the bank. So we expect to do the closing [on] all that documentation in August," Eide said.
Focus on balance sheet
The CFO said the company is "constantly considering [share] buybacks towards new investments, but priority now is on building a strong balance sheet".
The Oslo-listed, Kjell Inge Rokke-backed shipowner reported a $16.5m profit on Thursday, better than the $5.3m profit posted for the second quarter of 2019.
The company said it continues to look for employment for the troublesome 214,266-cbm floating production, storage and offloading unit Dhirubhai-1 (built 1979).
In May, Ocean Yield said it was hoping to take advantage of the floating storage trend to find work for the FPSO, which had been dragging on the company's earnings since it was released from its charter in 2018.
"If you look at the vessels without long-term charter, the FPSO which is currently in lay up in Sri Lanka, we are currently working on three different projects for the FPSO," said Solbakken.
"And work on these projects has been continuing despite the low oil price and Covid-19 during the second quarter. Of course, the Covid-19 and lower oil price have added to the uncertainty with respect to the project timelines."
