SFL Corporation Ltd reported a 30.8% sequential increase in net income for the second quarter of 2026, rising to $34 million, or $0.25 per share, compared with $26 million, or $0.20 per share, in the prior quarter. Earnings per share exceeded analyst expectations by $0.175, or 233%, as revenue climbed 15.3% to $201 million, topping the $171.78 million forecast by 17.0%. Adjusted EBITDA increased 20.4% to $130 million from $108 million in Q1 2026.
The company’s total gross charter hire across its fleet reached $199 million over approximately 4,620 operating days. Cash and cash equivalents stood at $113 million at quarter-end, with available liquidity exceeding $270 million, including undrawn credit lines. The book equity ratio was 29%, while the charter backlog expanded to $3.8 billion, up from $3.7 billion in Q1, with 65% tied to investment-grade customers. The car carrier backlog totaled $578 million.
Tanker segment performance drove the quarter’s gains, with gross charter hire rising to about $62 million from $46 million in the first quarter. Suezmax spot rates averaged $133,000 per day per vessel, a near-tripling from Q1’s $54,000 and a fourfold increase from the $30,000 average prior to December. Handymax product vessels achieved average daily TCE of approximately $16,100, up from $10,700 in Q1, while tanker utilization reached 99.8%. Container ships remained the largest revenue contributor, generating roughly $83 million in gross charter hire with 99.3% utilization. The energy drilling segment contributed $24 million, driven by the Linus rig under contract with ConocoPhillips, though utilization stood at 50% due to the Hercules rig being warm-stacked.
SFL declared a quarterly dividend of $0.22 per share, marking the 90th consecutive payout and bringing cumulative dividends to over $3 billion since 2004. The dividend yield stood at 7.2%. The company’s share price traded at $12.07, down 1.23% from the prior close, with a year-to-date gain of 62% and a 64% increase over the past 12 months.
Management highlighted fleet expansion and sustainability commitments. The company ordered four dual-fuel LNG-powered car carriers with a combined cost of $360 million, scheduled for 2029 delivery, two of which secured 5+5 year charters with an Asia-based manufacturer, adding $150 million to the fixed backlog with potential to reach $300 million if options are exercised. SFL also agreed to 3-year time charters for two older car carriers, adding $83 million to the backlog. Total remaining capital spending across five container and four car carrier newbuildings is approximately $1.2 billion, with seven vessels already under long-term charters. The Hercules drilling rig is being prepared for mobilization to Canada in February 2027 under a contract with 400 fixed days and extension options.
During Q2 and Q3, SFL raised $100 million in equity via ATM and DRIP programs, issuing 8.8 million shares at a premium to the volume-weighted average price. Management indicated no plans for further share issuance in the near term.
