The next few years will be “a lot of fun” for DOF Group and its investors, according to chief executive Mons Aase.
The Norwegian offshore vessel owner said it intends to refinance its more than $2bn in debt nearly a year ahead of time in an effort to start paying quarterly dividends next year as the market continues to rally.
Aase and chief financial officer Hilde Dornen laid out the plan at the company’s capital markets day in Oslo.
“On a refinancing, our main target is to ensure flexibility for the operation and to have a free float of cash,” Dornen said.
“We have a sizeable backlog and we have good visibility on our earnings going forward.”
The company expects the first dividends to be around $0.30 per share starting in the second quarter of 2025, a number Dornen believes can increase beginning in 2026.
“But this is conditional,” she said of higher dividends. “We, of course, need approval from the [annual general meeting], we need to complete the refinancing successfully and we need to close the [Maersk Supply Service] transaction.”
Dornen said the current capital structure prevents DOF Group from taking cash from its four existing subsidiaries: the DOFCON pipe layer joint venture with TechnipFMC, Brazilian anchor handling tug supply vessel outfit Norskan, DOF Subsea and manager DOF Rederi.
The refinancing aims to combine the cash generated by DOF Subsea, DOF Rederi and Maersk Supply Service. DOFCON and Norskan will be left alone.
She believes the company can complete the refinancing entirely with banks, but would also consider using the bond market.
As it stands, DOF has $1.5bn in debt, which rises to $2.1bn when Maersk Supply Service is included.
All of it matures in January 2026 and the company said it would like to move quickly to keep those figures from appearing as short-term debt on its balance sheet.
Alongside the refinancing, it aims to close the $1.1bn Maersk Supply Service merger in the fourth quarter.
In the blockbuster deal, announced in July, DOF will take on 22 vessels from the AP Moller Holdings-backed owner, and the Danish company will take a 25% stake in DOF.
“Of course, we have had good feedback from clients,” Aase said. “I think there will be a lot of opportunities for the combined company going forward.”
Once completed, DOF Group would be the world’s largest owner of construction support vessels (CSVs).
During the presentation, Aase used several recent contracts as examples of an improving offshore market, including a 70% jump in rates for one of its CSVs and a 44% rise for another.
“We will have a critical size in all regions,” he said. “This can result in even more interesting contracts and will increase the utilisation of the fleet.”
