SFL Corp returns to $97.2M profit in first nine months
The board declared a $0.22-per-share cash dividend payable on or around December 28, 2026, to shareholders of record as of December 15, 2026.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
6-K
SFL Corporation Ltd. (SFL) reported net income of $97.2 million for the nine months ended September 30, 2026, compared with a $21.8 million net loss for the nine months ended September 30, 2025. Revenue was $576.8 million versus $557.5 million, and operating income was $177.6 million versus $104.9 million. Operating cash flow was $209.7 million, compared with $215.6 million.
In October 2026, SFL agreed to build three dual-fuel Very Large Ammonia Carriers expected from the second quarter of 2028, and signed eight-year firm charters for two 8,800 TEU container vessels expected in 2027. It also agreed to sell four LR2 product tankers and three Suezmax tankers to their existing charterer, with delivery expected in the fourth quarter of 2026 and first quarter of 2027. Remaining purchase and construction commitments were approximately $1.7 billion.
Total borrowings were $2,347.2 million as of September 30, 2026. SFL said a significant portion was due within one year of this report and refinancing discussions were underway; it also said there was no assurance all facilities would be refinanced on acceptable terms or at all.
1 point · 0 major1 major · 1 point
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Hollow bars mark forward-looking points. How the balance works
Positive
- Moderate pointNet income was $97.2 million, versus a $21.8 million loss.
Negative
- Major point. Forward-looking: it has not happened yet and may not happen.Significant debt maturities within one year; timely refinancing is not assured.
Filing Explained
SFL’s completed issuance expanded its share base; two October court rulings remain appealable, with no related gain or loss recognized in the September 30 statements.
Form 6-K is a foreign private issuer’s interim report for material information published in its home market; this filing furnishes SFL’s unaudited results for the nine months ended
An ATM is an arrangement for an issuer to sell new shares gradually at prevailing market prices rather than in a single priced deal; SFL reports issuance through its ATM agreement and dividend reinvestment plan.
In October, the Court of Appeal ordered Seadrill to pay SFL’s subsidiary approximately
Key Figures
Net income: $97.2 million; prior-year net loss of $21.8 million
Operating revenues: $576.8 million; $557.5 million in the prior-year period
Operating income: $177.6 million; $104.9 million in the prior-year period
+5 more
8 metrics
Net income
$97.2 million; prior-year net loss of $21.8 million
Nine months ended September 30, 2026 and September 30, 2025
Operating revenues
$576.8 million; $557.5 million in the prior-year period
Nine months ended September 30, 2026 and September 30, 2025
Operating income
$177.6 million; $104.9 million in the prior-year period
Nine months ended September 30, 2026 and September 30, 2025
Net cash provided by operating activities
$209.7 million; $215.6 million in the prior-year period
Nine months ended September 30, 2026 and September 30, 2025
Total borrowings
$2,347.2 million
As of September 30, 2026
Remaining purchase and construction commitments
Approximately $1.7 billion
Following October 2026 agreements
Cash dividend
$0.22 per share
Declared November 4, 2026; payable on or around December 28, 2026
Cash and cash equivalents
$111.9 million
As of September 30, 2026
Key Terms
At-the-Market Sales Agreement, sale and leaseback transactions, share lending agreement, cash flow hedges
4 terms
At-the-Market Sales Agreement financial
"issued common shares under our dividend reinvestment plan and At-the-Market Sales Agreement"
An at-the-market sales agreement lets a company raise cash by selling newly issued shares directly into the open market at whatever price buyers are paying that day, using a broker to place the trades over time. Investors should watch these deals because they can dilute existing ownership and put downward pressure on the stock price while giving the company flexible, on-demand funding—like a store gradually listing extra items on an online marketplace at current prices.
sale and leaseback transactions financial
"entered into sale and leaseback transactions for the vessels"
share lending agreement financial
"maintain a general share lending agreement"
A share lending agreement is a contract where a shareholder temporarily lends their stock to another party, usually in exchange for a fee and collateral; the borrower returns the same number of shares later. It matters to investors because it can generate extra income for the lender, allow short selling that may put downward pressure on a stock, and introduces counterparty and voting-rights considerations—like lending your car and trusting it will come back in the same condition.
cash flow hedges financial
"derivative instruments that were designated as cash flow hedges"
A cash flow hedge is an accounting label companies use when they enter financial contracts—like currency or interest-rate agreements—to protect expected future cash payments or receipts from unpredictable moves. For investors, it signals that the company is trying to smooth out future cash variability (think of locking in a price to avoid surprises), which can reduce reported profit swings but also means the company has exposure to derivative instruments and their associated risks.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What were SFL's earnings for the first nine months of 2026?
SFL reported net income of $97.2 million and basic and diluted earnings per share of $0.71 for the nine months ended September 30, 2026. In the comparable 2025 period, it reported a net loss of $21.8 million and basic and diluted loss per share of $0.16.
How much operating cash flow did SFL report?
SFL generated $209.7 million of net cash from operating activities for the nine months ended September 30, 2026, compared with $215.6 million in the same period of 2025. The company attributed the decrease mainly to changes in operating income and the timing of charter hire and collections of trade and other receivables.
What dividend did SFL most recently declare?
The board declared a $0.22-per-share cash dividend on November 4, 2026, payable on or around December 28, 2026, to shareholders of record as of December 15, 2026.
What are the charter terms for SFL's three new Very Large Ammonia Carriers?
SFL agreed to build three dual-fuel Very Large Ammonia Carriers. Two are to be chartered to an investment-grade oil major, with the initial charter period to be determined within six months and extension options of up to four years. The third has a minimum five-year charter from delivery, extension options of up to two years, and a purchase option during the final two years of its fixed charter, subject to a profit-sharing arrangement.
AI-generated analysis. How Rhea-AI works. Not financial advice.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2026
Commission File Number: 001-32199
SFL Corporation Ltd.
(Translation of registrant’s name into English)
Par-la-Ville Place
14 Par-la-Ville Road
Hamilton, HM 08, Bermuda
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached hereto are the unaudited condensed consolidated financial statements and related Management’s Discussion and Analysis of Financial Condition and Results of Operations of SFL Corporation Ltd. (“SFL” or the “Company”) for the nine months ended September 30, 2026.
This report on Form 6-K is hereby incorporated by reference into the Company’s Registration Statement on Form F-3ASR (File No. 333-294365) filed with the U.S. Securities and Exchange Commission on March 17, 2026.
SFL CORPORATION LTD.
REPORT ON FORM 6-K FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2026
INDEX
Unaudited Condensed Consolidated Statements of Operations for the nine months ended September 30, 2026 and September 30, 2025 | Page 4 | ||||
Unaudited Condensed Consolidated Statements of Comprehensive Income for the nine months ended September 30, 2026 and September 30, 2025 | Page 5 | ||||
Unaudited Condensed Consolidated Balance Sheets as of September 30, 2026 and December 31, 2025 | Page 6 | ||||
Unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2026 and September 30, 2025 | Page 7 | ||||
Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the nine months ended September 30, 2026 and September 30, 2025 | Page 8 | ||||
| Notes to the Unaudited Condensed Consolidated Financial Statements | Page 9 | ||||
| Management’s Discussion and Analysis of Financial Condition and Results of Operations | Page 23 | ||||
| Cautionary Statement Regarding Forward-Looking Statements | Page 31 | ||||
| Signatures | Page 34 | ||||
3
SFL CORPORATION LTD.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
for the nine months ended September 30, 2026 and September 30, 2025
(in thousands of $, except per share amounts)
| Nine months ended | |||||||||||||||||
| September 30, | |||||||||||||||||
| 2026 | 2025 | ||||||||||||||||
| Operating revenues | |||||||||||||||||
| Time charter revenues | 409,090 | 458,084 | |||||||||||||||
| Voyage charter and pool revenues | 72,865 | 12,831 | |||||||||||||||
| Drilling contract revenues | 70,397 | 72,785 | |||||||||||||||
| Interest income – sales-type leases | — | 951 | |||||||||||||||
| Profit sharing income | 6,065 | 4,410 | |||||||||||||||
| Other operating income | 18,412 | 8,473 | |||||||||||||||
| Total operating revenues | 576,829 | 557,534 | |||||||||||||||
| Gain on sale of vessels | 11,503 | 4,530 | |||||||||||||||
| Operating expenses | |||||||||||||||||
| Vessel and rig operating expenses | 226,791 | 230,817 | |||||||||||||||
| Depreciation | 165,514 | 178,702 | |||||||||||||||
| Vessel impairment charge | — | 34,093 | |||||||||||||||
| Administrative expenses | 18,426 | 13,586 | |||||||||||||||
| Total operating expenses | 410,731 | 457,198 | |||||||||||||||
| Operating income | 177,601 | 104,866 | |||||||||||||||
| Non-operating income/(expense) | |||||||||||||||||
| Interest income – long-term loans to associated companies | 3,413 | 3,413 | |||||||||||||||
| Interest income – other | 4,178 | 6,863 | |||||||||||||||
| Interest expense | (109,179) | (137,589) | |||||||||||||||
| Gain/(Loss) on investments in equity securities | 1,469 | (768) | |||||||||||||||
| Interest and valuation gain/(loss) on non-designated derivatives | 21,276 | (2,808) | |||||||||||||||
| Other financial items, net | (1,689) | 3,617 | |||||||||||||||
| Equity in earnings of associated companies | 1,761 | 1,754 | |||||||||||||||
| Income/(Loss) before taxes | 98,830 | (20,652) | |||||||||||||||
| Tax expense | (1,609) | (1,126) | |||||||||||||||
| Net income/(loss) | 97,221 | (21,778) | |||||||||||||||
| Per share information: | |||||||||||||||||
| Basic earnings/(loss) per share | $ | 0.71 | $ | (0.16) | |||||||||||||
| Diluted earnings/(loss) per share | $ | 0.71 | $ | (0.16) | |||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4
SFL CORPORATION LTD.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)
for the nine months ended September 30, 2026 and September 30, 2025
(in thousands of $)
| Nine months ended | |||||||||||||||||
| September 30, | |||||||||||||||||
| 2026 | 2025 | ||||||||||||||||
| Net income/(loss) | 97,221 | (21,778) | |||||||||||||||
| Fair value adjustments to hedging financial instruments | 14,664 | (7,796) | |||||||||||||||
| Earnings reclassification of previously deferred fair value adjustments to hedging financial instruments | — | 134 | |||||||||||||||
| Other comprehensive loss | (482) | (222) | |||||||||||||||
| Other comprehensive income/(loss), net of tax | 14,182 | (7,884) | |||||||||||||||
| Comprehensive income/(loss) | 111,403 | (29,662) | |||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5
SFL CORPORATION LTD.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
as of September 30, 2026 and December 31, 2025
(in thousands of $, except share data)
| September 30, 2026 | December 31, 2025 | ||||||||||
| ASSETS | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | 111,895 | 150,829 | |||||||||
| Investments in debt and equity securities | 5,950 | 4,146 | |||||||||
| Due from related parties | 3,222 | 6,941 | |||||||||
| Trade accounts receivable | 31,543 | 11,571 | |||||||||
| Other current assets | 94,494 | 85,731 | |||||||||
| Total current assets | 247,104 | 259,218 | |||||||||
| Long-term assets | |||||||||||
| Vessels, rigs and equipment, net | 2,945,437 | 3,122,633 | |||||||||
| Capital improvements in progress and newbuildings | 217,224 | 181,074 | |||||||||
| Investments in associated companies | 15,413 | 15,832 | |||||||||
| Loans and long-term receivables from related parties including associates | 45,000 | 45,000 | |||||||||
| Other long-term assets | 45,504 | 14,386 | |||||||||
| Total assets | 3,515,682 | 3,638,143 | |||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities | |||||||||||
| Short-term debt and current portion of long-term debt | 612,766 | 605,943 | |||||||||
| Due to related parties | 2,278 | 1,303 | |||||||||
| Other current liabilities | 91,104 | 103,079 | |||||||||
| Total current liabilities | 706,148 | 710,325 | |||||||||
| Long-term liabilities | |||||||||||
| Long-term debt | 1,720,715 | 1,960,533 | |||||||||
| Other long-term liabilities | 1,696 | 6,423 | |||||||||
| Total liabilities | 2,428,559 | 2,677,281 | |||||||||
| Stockholders’ equity | 1,087,123 | 960,862 | |||||||||
| Total liabilities and stockholders’ equity | 3,515,682 | 3,638,143 | |||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
6
SFL CORPORATION LTD.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
for the nine months ended September 30, 2026 and September 30, 2025
(in thousands of $)
| Nine months ended | |||||||||||
| September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net income/(loss) | 97,221 | (21,778) | |||||||||
| Adjustments to reconcile net income/(loss) to net cash provided by operating activities: | |||||||||||
| Depreciation | 165,514 | 178,702 | |||||||||
| Vessel impairment charge | — | 34,093 | |||||||||
| Amortization of deferred charges | 4,657 | 6,347 | |||||||||
| Amortization of charter related deferred asset and straight-lining of operating leases | 2,512 | (483) | |||||||||
| Equity in earnings of associated companies | (1,761) | (1,754) | |||||||||
| Gain on sale of vessels | (11,503) | (4,530) | |||||||||
| Adjustment to fair value of derivatives recognized in the statement of operations | (19,223) | 5,246 | |||||||||
| (Gain)/Loss on investments in equity securities | (1,469) | 768 | |||||||||
| Loss on repurchase of bonds | — | 144 | |||||||||
| Repayments from investment in sales-type assets | — | 4,021 | |||||||||
| Capitalized lease debt financing interest | 7,195 | 5,770 | |||||||||
| Other, net | 2,852 | 2,686 | |||||||||
| Net changes in operating assets and liabilities | (36,333) | 6,353 | |||||||||
| Net cash provided by operating activities | 209,662 | 215,585 | |||||||||
| Investing activities | |||||||||||
| Purchase of vessels, capital improvements and newbuildings | (73,890) | (71,142) | |||||||||
| Proceeds from asset related grants and insurance claims | 12,619 | 4,793 | |||||||||
| Proceeds from sale of vessels | 48,308 | 209,488 | |||||||||
| Other investments | (140) | — | |||||||||
| Net cash provided by/(used in) investing activities | (13,103) | 143,139 | |||||||||
| Financing activities | |||||||||||
| Proceeds from debt | 305,600 | 244,042 | |||||||||
| Repayment of debt | (553,312) | (341,228) | |||||||||
| Debt fees paid | (753) | (3,018) | |||||||||
| Net cash flows on swaps | — | (6,265) | |||||||||
| Cash received/(paid) from share issuances and repurchases | 100,496 | (10,025) | |||||||||
| Cash dividends paid | (87,524) | (98,550) | |||||||||
| Net cash used in financing activities | (235,493) | (215,044) | |||||||||
| Net change in cash and cash equivalents | (38,934) | 143,680 | |||||||||
| Cash and cash equivalents at start of the period | 150,829 | 134,551 | |||||||||
| Cash and cash equivalents at end of the period | 111,895 | 278,231 | |||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
7
SFL CORPORATION LTD.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
for the nine months ended September 30, 2026 and September 30, 2025
(in thousands of $, except number of shares)
| Nine months ended | |||||||||||||||||
| September 30, | |||||||||||||||||
| 2026 | 2025 | ||||||||||||||||
| Number of shares outstanding | |||||||||||||||||
| At beginning of period | 144,562,927 | 145,708,524 | |||||||||||||||
| Shares issued | 9,230,628 | 107,060 | |||||||||||||||
| Shares repurchased | — | (1,252,657) | |||||||||||||||
| At end of period | 153,793,555 | 144,562,927 | |||||||||||||||
| Share capital | |||||||||||||||||
| At beginning of period | 1,469 | 1,468 | |||||||||||||||
| Shares issued | 92 | 1 | |||||||||||||||
| At end of period | 1,561 | 1,469 | |||||||||||||||
| Additional paid-in capital | |||||||||||||||||
| At beginning of period | 717,969 | 716,233 | |||||||||||||||
| Amortization of stock-based compensation | 1,013 | 980 | |||||||||||||||
| Shares issued | 101,277 | 426 | |||||||||||||||
| At end of period | 820,259 | 717,639 | |||||||||||||||
| Treasury stock | |||||||||||||||||
| At beginning of period | (20,199) | (10,174) | |||||||||||||||
Treasury stock at cost (0 and 1,252,657 shares, respectively) | — | (10,025) | |||||||||||||||
| At end of period | (20,199) | (20,199) | |||||||||||||||
| Contributed surplus | |||||||||||||||||
| At beginning of period | 292,574 | 417,684 | |||||||||||||||
| Dividends declared | (26,564) | (98,550) | |||||||||||||||
| At end of period | 266,010 | 319,134 | |||||||||||||||
| Accumulated other comprehensive income/(loss) | |||||||||||||||||
| At beginning of period | (4,520) | 3,211 | |||||||||||||||
| Other comprehensive income/(loss) | 14,182 | (7,884) | |||||||||||||||
| At end of period | 9,662 | (4,673) | |||||||||||||||
| Retained earnings / (accumulated deficit) | |||||||||||||||||
| At beginning of period | (26,431) | — | |||||||||||||||
| Net income/(loss) | 97,221 | (21,778) | |||||||||||||||
| Dividends declared | (60,960) | — | |||||||||||||||
| At end of period | 9,830 | (21,778) | |||||||||||||||
| Total stockholders’ equity | 1,087,123 | 991,592 | |||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
8
SFL CORPORATION LTD.
Notes to the Unaudited Condensed Consolidated Financial Statements
1.INTERIM FINANCIAL INFORMATION
The unaudited condensed consolidated financial statements of SFL Corporation Ltd. (“SFL” or the “Company”) have been prepared on the same basis as the Company’s audited consolidated financial statements and, in the opinion of management, include all material adjustments, consisting only of normal recurring adjustments considered necessary in order to make these financial statements not misleading, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying unaudited condensed consolidated financial statements do not include all of the disclosures required in annual consolidated financial statements and should be read in conjunction with the annual consolidated financial statements and notes included in the Annual Report on Form 20-F for the year ended December 31, 2025, which was filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 16, 2026. The results of operations for the interim period ended September 30, 2026 are not necessarily indicative of the results for the entire year ending December 31, 2026.
Basis of accounting
The unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP. The unaudited condensed consolidated financial statements include the assets and liabilities and results of operations of the Company and its subsidiaries including variable interest entities in which the Company is deemed to be the primary beneficiary. All inter-company balances and transactions have been eliminated on consolidation.
The unaudited condensed consolidated financial statements are prepared in accordance with the accounting policies described in the Company’s Annual Report on Form 20-F for the year ended December 31, 2025.
Recently Issued Accounting Standards
The following is a brief discussion of a selection of recently released accounting pronouncements that are considered pertinent to the Company’s business and are not yet adopted.
In May 2026, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2026-02, Environmental Credits and Environmental Credit Obligations (Topic 818) (“ASU 2026-02”). The ASU defines environmental credits and when they should be recognized as assets, distinguishes between compliance and noncompliance credits for subsequent measurement, and requires enhanced disclosures about how credits are obtained, used, and valued. The ASU also defines environmental credit obligations and clarifies when entities must recognize environmental credit obligation liabilities arising from regulatory compliance programs, how to measure those liabilities, and what information must be disclosed about those obligations. The amendments are effective for the Company for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
In December 2025, the FASB issued ASU No. 2025-12, Codification Improvements (“ASU 2025-12”). The amendments in this ASU update the FASB Accounting Standards Codification for a broad range of topics arising from technical corrections, unintended application of the Codification, clarifications, and other minor improvements. The amendments are effective for the Company for annual periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements (“ASU 2025-11”). The ASU improves guidance about the format and information included in the interim financial statements, lists the required interim disclosures and provides a disclosure principle that requires entities to disclose events and changes that occur after the end of the most recent fiscal year that have a material impact on the entity. The amendments are effective for the Company for interim periods within annual periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
9
In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”). ASU 2024-03 requires entities to disclose specific information about certain costs and expenses in the notes to the financial statements for interim and annual reporting periods. The objective of the disclosure requirements is to provide disaggregated information about a public business entity's expense to help investors (a) better understand the entity's performance, (b) better assess the entity's prospects for future cash flows, and (c) compare the entity's performance over time and with that of other entities. In January 2025, the FASB issued ASU No. 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”), which clarified that all public entities are required to adopt the guidance in ASU 2024-03 in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the impacts that ASU 2024-03 and ASU 2025-01 will have on the Company’s financial statements’ presentation and disclosures.
Recently Adopted Accounting Standards
In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”). The amendments provide all entities with a practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the assets. The amendments became effective for the Company on January 1, 2026. Adoption of ASU 2025-05 did not have a material impact on the Company’s financial statements’ presentation and disclosures.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Such estimates include, but are not limited to, the valuation and impairment assessment of vessels, rigs and equipment.
Management believes the accounting estimates and assumptions applied are appropriate in light of the continuing market volatility associated with U.S. and global trade policies, including tariffs and port fees, as well as sanctions and geopolitical conflicts, including the war between Russia and Ukraine and developments in the Middle East. However, actual results could differ materially from those estimates.
Segment Information
The chief operating decision maker evaluates performance by assessing the Company’s consolidated net income and its impact on overall shareholder returns, leading to a determination that the Company operates within a single reportable segment. The Company's assets operate on a world-wide basis and the Company’s management does not evaluate performance by geographical region or by asset type, as it believes that any such information would not be meaningful. There have been no material changes since the Company’s Annual Report on Form 20-F for the year ended December 31, 2025.
10
2.GAIN ON SALE OF VESSELS
| (in thousands of $) | Nine months ended | Nine months ended | |||||||||||||||
| September 30, 2026 | September 30, 2025 | ||||||||||||||||
| Net Proceeds | Gain/(Loss) | Net Proceeds | Gain/(Loss) | ||||||||||||||
| Disposal of investments in sales-type leases | |||||||||||||||||
Seven 4,100 TEU container vessels* | — | — | 31,150 | — | |||||||||||||
Disposal of vessels | |||||||||||||||||
| SFL Thelon | 48,308 | 11,503 | — | — | |||||||||||||
| Asian Ace | — | — | 9,449 | 4,336 | |||||||||||||
| SFL Yukon | — | — | 9,974 | (98) | |||||||||||||
| SFL Sara | — | — | 10,911 | (734) | |||||||||||||
| SFL Kate | — | — | 11,362 | (289) | |||||||||||||
| SFL Hudson | — | — | 10,722 | 812 | |||||||||||||
| SFL Humber | — | — | 11,848 | (618) | |||||||||||||
Eight Capesize dry bulk vessels* | — | — | 114,071 | 1,121 | |||||||||||||
| Total | 48,308 | 11,503 | 209,487 | 4,530 | |||||||||||||
*Disposal following the exercise of purchase options within their charter agreements.
3.EARNINGS/(LOSS) PER SHARE
The computation of basic earnings/(loss) per share (“EPS”) is based on the weighted average number of common shares outstanding during the period and the Company's consolidated net income or loss. Diluted EPS reflects the effect of potentially dilutive instruments, using the treasury stock method for stock options and the if-converted method for convertible debt instruments.
The components of the numerator for the calculation of basic and diluted EPS are as follows:
| Nine months ended | |||||||||||||||||
| (in thousands of $) | September 30, 2026 | September 30, 2025 | |||||||||||||||
| Basic and diluted earnings/(loss) per share: | |||||||||||||||||
| Net income/(loss) available to stockholders | 97,221 | (21,778) | |||||||||||||||
The components of the denominator for the calculation of basic and diluted EPS are as follows:
| Nine months ended | |||||||||||||||||
| (in thousands) | September 30, 2026 | September 30, 2025 | |||||||||||||||
| Basic earnings/(loss) per share: | |||||||||||||||||
| Weighted average number of common shares outstanding* | 136,335 | 133,153 | |||||||||||||||
| Diluted earnings/(loss) per share: | |||||||||||||||||
| Weighted average number of common shares outstanding* | 136,335 | 133,153 | |||||||||||||||
| Effect of dilutive share options | 583 | — | |||||||||||||||
| Weighted average number of common shares outstanding assuming dilution | 136,918 | 133,153 | |||||||||||||||
11
| Nine months ended | |||||||||||||||||
| September 30, 2026 | September 30, 2025 | ||||||||||||||||
| Basic earnings/(loss) per share: | $ | 0.71 | $ | (0.16) | |||||||||||||
| Diluted earnings/(loss) per share: | $ | 0.71 | $ | (0.16) | |||||||||||||
*The weighted average number of common shares outstanding excluded 8,000,000 shares issued as part of a share lending arrangement relating to the Company's issuance of 5.75% senior unsecured convertible bonds in October 2016 and 3,765,842 shares issued as part of a share lending arrangement relating to the Company's issuance of 4.875% senior unsecured convertible bonds in April and May 2018. The Company entered into a general share lending agreement with another counterparty and after the maturity of the bonds, 8,000,000 and 3,765,142 shares, respectively, from each issuance under the two initial share lending arrangements described above were transferred into such counterparty's custody. During the year ended December 31, 2024, the Company cancelled the remaining 700 shares, which were previously held by the Company’s transfer agent. Accordingly, the total of 11,765,142 shares which had been issued under these arrangements are not included in the weighted average number of common shares outstanding as of September 30, 2026.
The weighted average number of common shares outstanding also excludes 2,347,752 shares repurchased by the Company under its Share Repurchase Program and held as treasury stock as of September 30, 2026. (See also Note 10: Share Capital, Additional Paid-In Capital and Contributed Surplus).
For the nine months ended September 30, 2025, basic and diluted net loss per share were identical, as all potentially dilutive securities were antidilutive. Share options were excluded from the diluted earnings per share calculation for this period because their inclusion would have resulted in an antidilutive effect.
4.OTHER FINANCIAL ITEMS
Other financial items, net consist of the following items:
| Nine months ended | |||||||||||||||||
| (in thousands of $) | September 30, 2026 | September 30, 2025 | |||||||||||||||
| Change in allowance for expected credit losses | (107) | 664 | |||||||||||||||
| Dividend income | 431 | 426 | |||||||||||||||
| Loss on repurchase of bonds | — | (144) | |||||||||||||||
Foreign currency translations and other items | (2,013) | 2,671 | |||||||||||||||
| Total other financial items, net | (1,689) | 3,617 | |||||||||||||||
The Company recognizes, among other things, a measurement of expected credit losses for financial assets held at the reporting date, based on historical experience, current conditions and reasonable supportable forecasts.
In the nine months ended September 30, 2026, there was a net loss of $0.7 million arising from foreign currency translations (nine months ended September 30, 2025: gain of $3.8 million). Other items also include bank charges and fees relating to loan facilities.
5.INVESTMENTS IN DEBT AND EQUITY SECURITIES
As of September 30, 2026 and December 31, 2025, the equity securities consisted of approximately 1.3 million shares in NorAm Drilling Company AS (“NorAm Drilling”) which are traded on the Euronext Growth in Oslo. The Company recognized a mark to market gain of $1.5 million in the Statement of Operations in the nine months ended September 30, 2026 (September 30, 2025: loss of $0.8 million), together with a foreign exchange gain of $0.2 million (September 30, 2025: gain of $0.5 million), in Other Financial Items in the Statement of Operations. As of September 30, 2026, the Company also held a debt security with a carrying value of $0.1 million, acquired in April 2026.
12
6.VESSELS, RIGS AND EQUIPMENT, NET
| (in thousands of $) | September 30, 2026 | December 31, 2025 | |||||||||
| Cost | 3,981,853 | 4,003,773 | |||||||||
| Accumulated depreciation | (1,036,416) | (881,140) | |||||||||
| Vessels, rigs and equipment, net | 2,945,437 | 3,122,633 | |||||||||
During the nine months ended September 30, 2026, the Company recognized a net amount of $25.1 million of capital upgrades in relation to three container vessels, two chemical tankers and one rig (December 31, 2025: $51.7 million in relation to 14 container vessels, one car carrier, one chemical tanker, four Suezmax tankers and two drilling rigs). Certain upgrades and special periodic survey (“SPS”) costs are capitalized as separate asset components and depreciated over shorter useful economic lives that range from three years to 10 years for upgrades and five years for SPS costs.
During the nine months ended September 30, 2026, the Company sold one Suezmax tanker (December 31, 2025: one container vessel, 13 dry bulk vessels and one Suezmax tanker). See also Note 2: Gain on Sale of Vessels.
7.CAPITAL IMPROVEMENTS IN PROGRESS AND NEWBUILDINGS
| (in thousands of $) | September 30, 2026 | December 31, 2025 | |||||||||
| Capital improvements in progress | 15,201 | 26,138 | |||||||||
| Newbuildings | 202,023 | 154,936 | |||||||||
| Total | 217,224 | 181,074 | |||||||||
Capital improvements in progress consist of advances paid and costs incurred in relation to upgrades on two rigs (December 31, 2025: SPS and upgrades on two rigs and four vessels). These costs are recorded in “Capital improvements in progress” until the related equipment is installed on the applicable vessel or rig, at which point the amounts are transferred to “Vessels, Rigs and Equipment, net”.
As of September 30, 2026, the Company recorded $202.0 million in installment payments and capitalized interest in relation to shipbuilding contracts for the construction of five newbuilding dual-fuel 16,800 TEU container vessels and four newbuilding dual-fuel 7,000 CEU car carriers (December 31, 2025: $154.9 million for five container vessels). Additionally, in October 2026, the Company entered into agreements for the construction of three 93,000 cbm Very Large Ammonia Carriers. See also Note 14: Subsequent Events. All vessels under construction are expected to be delivered to the Company between 2028 and 2029.
Interest capitalized in the cost of newbuildings amounted to $5.9 million in the nine months ended September 30, 2026 (December 31, 2025: $8.4 million).
13
8.SHORT-TERM AND LONG-TERM DEBT
| (in thousands of $) | September 30, 2026 | December 31, 2025 | |||||||||
| Short-term and long-term debt: | |||||||||||
7.25% senior unsecured sustainability-linked bonds due 2026 | — | 150,000 | |||||||||
| U.S. dollar denominated fixed rate debt due 2026 | — | 145,875 | |||||||||
8.875% senior unsecured sustainability-linked bonds due 2027 | 150,000 | 150,000 | |||||||||
8.25% senior unsecured sustainability-linked bonds due 2028 | 147,600 | 147,600 | |||||||||
NOK750 million senior unsecured floating rate bonds due 2029 | 77,944 | 74,327 | |||||||||
7.75% senior unsecured sustainability-linked bonds due 2030 | 225,000 | 144,400 | |||||||||
| U.S. dollar denominated floating rate debt | 1,120,265 | 1,085,540 | |||||||||
| Lease debt financing | 626,423 | 686,389 | |||||||||
| Total debt principal | 2,347,232 | 2,584,131 | |||||||||
| Less: Unamortized debt issuance costs | (13,751) | (17,655) | |||||||||
| Less: Current portion of long-term debt | (612,766) | (605,943) | |||||||||
| Total long-term debt | 1,720,715 | 1,960,533 | |||||||||
In March 2026, the Company fully repaid the $150.0 million senior secured term loan facility secured by the jack-up drilling rig Linus, which had an outstanding balance of $145.9 million as of December 31, 2025. As part of the refinancing, in March 2026, the Company also fully drew down a new $150.0 million three-year senior secured revolving credit facility secured by Linus, which was entered into in February 2026. The revolving credit facility bears interest at compounded daily SOFR plus an applicable margin. The net amount outstanding as of September 30, 2026, was $145.0 million.
In April 2026, the Company completed a $75.0 million tap issue of the senior unsecured sustainability-linked bond due 2030 in the Nordic credit market. The tap issue was priced at 103.5% of face value and, together with the previously outstanding bonds, bears a coupon of 7.75% and will mature in 2030. During the nine months ended September 30, 2026, the Company resold bonds which had previously been repurchased with principal amounts totaling $5.6 million. The net amount outstanding as of September 30, 2026, was $225.0 million (December 31, 2025: $144.4 million).
In May 2026, the Company fully repaid the $150.0 million senior unsecured sustainability-linked bonds due 2026, which had an outstanding balance of $150.0 million as of December 31, 2025.
A significant portion of the Company’s outstanding debt will be due within one year of this report for which the Company has initiated discussions and negotiations with financial institutions regarding the refinancing of such maturing credit facilities. Given the Company’s extensive history and successful track record in obtaining financing and refinancing, the Company believes that it will be reasonably able to secure the required refinancing of all such facilities prior to or at maturity.
Interest rate information:
| September 30, 2026 | December 31, 2025 | ||||||||||
| Weighted average interest rate on floating rate debt* | 5.29 | % | 5.25 | % | |||||||
| Weighted average interest rate on lease debt financing | 4.76 | % | 5.02 | % | |||||||
| Weighted average interest rate on fixed rate debt | 8.21 | % | 8.27 | % | |||||||
| Secured Overnight Financing Rate (“SOFR”), closing rate | 3.90 | % | 3.87 | % | |||||||
| Effective Federal Funds Rate (“EFFR”), closing rate | 3.88 | % | 3.64 | % | |||||||
| Norwegian Interbank Offered Rate (“NIBOR”), three-month, closing rate | 4.80 | % | 4.07 | % | |||||||
*The weighted average interest rate is for floating rate debt denominated in U.S. dollars and Norwegian kroner (“NOK”) which takes into consideration the effect of related interest rate and cross currency swaps.
14
U.S. dollar floating rate debt
The following table presents information on U.S. dollar floating rate debt facilities outstanding as of September 30, 2026 and December 31, 2025. The facilities bear interest at SOFR plus a margin, except the $60.0 million loan facility, which bears interest at EFFR plus a margin.
| U.S. dollar floating rate debt | Corporate guarantee | Draw-down date | No. of subsidiaries † | Approx. term | Balance outstanding as of | |||||||||||||||
| September 30, 2026 | December 31, 2025 | |||||||||||||||||||
| ($'millions) | ||||||||||||||||||||
35 million term loan facility* | Part | 2021 | 1 | 7 | 25.2 | 26.8 | ||||||||||||||
107.3 million term loan facility* | Part | 2021 | 3 | 5 | 78.4 | 83.1 | ||||||||||||||
100 million term loan facility* | Part | 2022 | 4 | 5 | 54.5 | 62.1 | ||||||||||||||
144.6 million term loan facility* | Full | 2023 | 4 | 6 | 67.3 | 93.9 | ||||||||||||||
60 million loan facility*** | Part | 2024 | 1 | N/A | — | — | ||||||||||||||
79.8 million term loan facility* | Part | 2024 | 2 | 5 | 71.3 | 74.5 | ||||||||||||||
163.8 million term loan facility* | Part | 2024 | 3 | 5 | 148.1 | 154.2 | ||||||||||||||
150 million term loan facility* | Part | 2024 | 3 | 6 | 111.5 | 125.9 | ||||||||||||||
226 million term loan facility** | Full | 2024 | 7 | 5 | 163.0 | 186.5 | ||||||||||||||
235 million term loan facility* | Full | 2024 | 4 | 5 | 180.7 | 203.2 | ||||||||||||||
81.6 million term loan facility**** | Full | 2024 | 2 | 3 | 75.3 | 75.3 | ||||||||||||||
150 million revolving credit facility** | Full | 2026 | 1 | 3 | 145.0 | — | ||||||||||||||
100 million revolving credit facility** | Full | N/A | 1 | 2 | — | — | ||||||||||||||
| Total | 1,120.3 | 1,085.5 | ||||||||||||||||||
† Number of wholly-owned subsidiaries which entered into the facility.
*These facilities are secured against the vessels owned by the subsidiaries that entered into the facility agreements. In addition, the facilities contain a minimum value covenant and covenants that require the Company to maintain certain minimum levels of free cash, working capital and adjusted book equity ratios.
** These facilities are secured against the pre-delivery contracts, vessels or rigs owned by the subsidiaries that entered into the facility agreements. In addition, the facilities contain covenants that require the Company to maintain certain minimum levels of free cash, working capital and adjusted book equity ratios.
***In December 2021, one of the Company's wholly-owned subsidiaries entered into a general share lending agreement. As of September 30, 2026, 11.8 million of the Company’s common shares were on loan and in the custody of the borrowing bank. This facility provides up to $60.0 million cash collateral to the Company, callable at any time, in connection with the shares lent. The facility is repayable on demand, by either party to the agreement.
**** During the nine months ended September 30, 2026, this $81.6 million term loan was extended by one year to September 30, 2027.
In March 2026, one of the Company's wholly-owned subsidiaries entered into a $100.0 million senior secured revolving credit facility in connection with the Hercules rig. The facility bears interest at SOFR plus an applicable margin.
15
Lease Debt Financing
Wholly-owned subsidiaries of the Company have entered into sale and leaseback transactions for the vessels that they own, through Japanese operating lease with call option financing structures. The vessels have been sold and leased back, with options to repurchase the vessels. These transactions did not qualify as sales under the U.S. GAAP sale and leaseback guidance and have thus been recorded as financing arrangements. The following table presents information on lease debt financing facilities outstanding as of September 30, 2026 and December 31, 2025.
Lease Debt Financing | Price of vessel sold and leased back ($' millions) | Lease start date | Approx. length of lease in years | First repurchase option | Balance outstanding as of | ||||||||||||||||||
| September 30, 2026 | December 31, 2025 | ||||||||||||||||||||||
| ($'millions) | |||||||||||||||||||||||
$65 million lease debt financing | 65.0 | 2021 | 6 | 2026 | 28.4 | 34.3 | |||||||||||||||||
$65 million lease debt financing | 65.0 | 2021 | 6 | 2026 | 28.8 | 34.7 | |||||||||||||||||
$120 million lease debt financing | 120.0 | 2022 | 8 | 2029 | 78.2 | 86.9 | |||||||||||||||||
$120 million lease debt financing | 120.0 | 2022 | 8 | 2029 | 79.8 | 88.4 | |||||||||||||||||
$45 million lease debt financing | 45.0 | 2023 | 5 | 2028 | 27.1 | 31.3 | |||||||||||||||||
$38.5 million lease debt financing | 38.5 | 2023 | 9 | 2028 | 29.9 | 32.0 | |||||||||||||||||
$72.2 million lease debt financing | 72.2 | 2023 | 12 | 2033 | 60.9 | 63.9 | |||||||||||||||||
$72.2 million lease debt financing | 72.2 | 2023 | 12 | 2033 | 61.9 | 64.8 | |||||||||||||||||
$77.5 million lease debt financing | 77.5 | 2024 | 12 | 2033 | 66.7 | 69.8 | |||||||||||||||||
$77.5 million lease debt financing | 77.5 | 2024 | 12 | 2033 | 67.6 | 70.8 | |||||||||||||||||
$37 million lease debt financing | 37.0 | 2024 | 8 | 2028 | 30.2 | 32.6 | |||||||||||||||||
$43 million lease debt financing | 43.0 | 2025 | 5 | 2027 | 35.4 | 40.0 | |||||||||||||||||
$40.5 million lease debt financing | 40.5 | 2025 | 4 | 2027 | 31.5 | 36.9 | |||||||||||||||||
| Total | 626.4 | 686.4 | |||||||||||||||||||||
| Floating rate portion of lease debt | 276.0 | 321.5 | |||||||||||||||||||||
| Fixed rate portion of lease debt | 350.4 | 364.9 | |||||||||||||||||||||
| Total | 626.4 | 686.4 | |||||||||||||||||||||
16
9.FINANCIAL INSTRUMENTS
The following table presents the fair values of the Company’s derivative instruments that were designated as cash flow hedges and qualified as part of a hedging relationship, and those that were not designated:
| (in thousands of $) | September 30, 2026 | December 31, 2025 | |||||||||
| Designated derivative instruments - long-term assets: | |||||||||||
| Interest rate swaps | 7,080 | — | |||||||||
| Cross currency interest rate swaps | 11,837 | 5,741 | |||||||||
| Non-designated derivative instruments - long-term assets: | |||||||||||
| Interest rate swaps | 25,396 | 7,887 | |||||||||
| Cross currency interest rate swaps | 897 | 464 | |||||||||
| Total derivative instruments - long-term assets | 45,210 | 14,092 | |||||||||
| (in thousands of $) | September 30, 2026 | December 31, 2025 | |||||||||
| Designated derivative instruments - long-term liabilities: | |||||||||||
| Interest rate swaps | — | 5,022 | |||||||||
| Non-designated derivative instruments - long-term liabilities: | |||||||||||
| Interest rate swaps | — | 1,124 | |||||||||
| Total derivative instruments - long-term liabilities | — | 6,146 | |||||||||
Movements in the Unaudited Condensed Consolidated Statement of Operations are summarized as follows:
| Nine months ended | |||||||||||
(in thousands of $) | September 30, 2026 | September 30, 2025 | |||||||||
| Net fair value movements of non-designated derivatives | 19,223 | (5,246) | |||||||||
| Net cash movement on non-designated derivatives and swap settlements | 2,053 | 2,438 | |||||||||
Total cash movement and valuation gain/(loss) on non-designated derivatives | 21,276 | (2,808) | |||||||||
Interest rate risk management
The Company manages its debt portfolio with interest rate swap agreements denominated in U.S. dollars and Norwegian kroner to achieve an overall desired position of fixed and floating interest rates.
As of September 30, 2026, the Company and its consolidated subsidiaries had entered into interest rate swap transactions, involving the payment of fixed rates in exchange for NIBOR or SOFR. The total net notional principal amount subject to interest rate swap agreements as of September 30, 2026, was $0.8 billion (December 31, 2025: $0.8 billion).
Foreign currency risk management
The Company is party to currency swap transactions, involving the payment of U.S. dollars in exchange for Norwegian kroner, some of which are designated as hedges against the NOK750.0 million senior unsecured floating rate bonds due 2029. The total net notional principal amount subject to cross currency swap agreements as of September 30, 2026 was NOK750.0 million (December 31, 2025: NOK750.0 million).
Other than the NOK750 million senior unsecured floating rate bonds due 2029, the majority of the Company’s transactions, assets and liabilities are denominated in U.S. dollars, the functional currency of the Company. Other than the corresponding currency swap transactions summarized above, the Company has not entered into forward contracts for either transaction or translation risk. Accordingly, there is a risk that currency fluctuations could have an adverse effect on the Company’s cash flows, financial condition and results of operations.
17
Fair Values
The carrying value and estimated fair value of the Company’s financial assets and liabilities as of September 30, 2026 and December 31, 2025 are as follows:
| September 30, 2026 | December 31, 2025 | ||||||||||||||||||||||
| (in thousands of $) | Carrying value | Fair value | Carrying value | Fair value | |||||||||||||||||||
| Non-derivatives: | |||||||||||||||||||||||
| Equity securities | 5,810 | 5,810 | 4,146 | 4,146 | |||||||||||||||||||
| Debt securities | 140 | 140 | — | — | |||||||||||||||||||
7.25% senior unsecured sustainability-linked bonds due 2026 | — | — | 150,000 | 151,500 | |||||||||||||||||||
8.875% senior unsecured sustainability-linked bonds due 2027 | 150,000 | 151,215 | 150,000 | 154,575 | |||||||||||||||||||
8.25% senior unsecured sustainability-linked bonds due 2028 | 147,600 | 152,213 | 147,600 | 152,213 | |||||||||||||||||||
NOK750 million senior unsecured floating rate bonds due 2029 | 77,944 | 77,691 | 74,327 | 74,327 | |||||||||||||||||||
7.75% senior unsecured sustainability-linked bonds due 2030 | 225,000 | 231,281 | 144,400 | 146,927 | |||||||||||||||||||
| Derivatives: | |||||||||||||||||||||||
| Interest rate/ currency swap contracts - long-term receivables | 45,210 | 45,210 | 14,092 | 14,092 | |||||||||||||||||||
| Interest rate/ currency swap contracts - long-term payables | — | — | 6,146 | 6,146 | |||||||||||||||||||
In accordance with the accounting policy relating to interest rate and currency swaps described in the Company’s Annual Report on Form 20-F for the year ended December 31, 2025, changes in the fair values of the swaps are recognized in other comprehensive income where the Company has designated the swaps as hedges. Changes in the fair value of other swaps not designated as hedges are recognized in the Unaudited Condensed Consolidated Statement of Operations.
The investment in equity securities and the Company issued senior unsecured bonds are measured at fair value using Level 1 inputs, while the Company’s derivative instruments are measured using Level 2 inputs. The estimated fair value of the Company's investment in debt securities is determined using Level 3 inputs.
As of September 30, 2026, investment in equity securities consist of NorAm Drilling shares trading on the Euronext Growth in Oslo.
The estimated fair values of the 7.25% senior unsecured sustainability-linked bonds due 2026, the 8.875% senior unsecured sustainability-linked bonds due 2027, the 8.25% senior unsecured sustainability-linked bonds due 2028, the 7.75% senior unsecured sustainability-linked bonds due 2030 and the floating rate NOK denominated bonds due 2029 are all based on their quoted market prices as of the balance sheet date.
The estimated fair value of interest rate and currency swap contracts is calculated using a well-established independent valuation technique applied to contracted cash flows and NIBOR or SOFR interest rates as of September 30, 2026.
Concentrations of risk
There is a concentration of credit risk with respect to cash and cash equivalents to the extent that amounts are carried with DNB Bank ASA, Skandinaviska Enskilda Banken AB (publ.), Danske Bank A/S, ING Bank N.V and Sumitomo Mitsui Banking Corporation. However, the Company believes this risk is remote, as these financial institutions are established and reputable establishments.
The Company does not require collateral or other securities to support financial instruments that are subject to credit risk, however certain of the Company’s counterparties require the Company to periodically post collateral when the fair value of the financial instruments exceeds or is below specified thresholds. As of September 30, 2026, no cash collateral was posted by the Company (December 31, 2025: $0.0 million).
There is also a concentration of revenue risk with Maersk A/S (“Maersk”), ConocoPhillips Skandinavia AS (“ConocoPhillips”) and Hapag-Lloyd AG, to whom the Company charters several vessels and earns a significant proportion of its revenues.
18
10.SHARE CAPITAL, ADDITIONAL PAID-IN CAPITAL AND CONTRIBUTED SURPLUS
Authorized share capital is as follows:
| (in thousands of $, except share data) | September 30, 2026 | December 31, 2025 | |||||||||
300,000,000 common shares of $0.01 par value each (December 31, 2025: 300,000,000 common shares of $0.01 par value each) | 3,000 | 3,000 | |||||||||
Issued and fully paid share capital is as follows:
| (in thousands of $, except share data) | September 30, 2026 | December 31, 2025 | |||||||||
156,141,307 common shares of $0.01 par value each (December 31, 2025: 146,910,679 common shares of $0.01 par value each) | 1,561 | 1,469 | |||||||||
The Company’s common shares are listed on the New York Stock Exchange under the ticker symbol “SFL”.
Repurchase of shares
On May 8, 2023, the Board of Directors authorized the repurchase of up to an aggregate of $100 million of the Company’s common shares (“Share Repurchase Program”). The authorization was reaffirmed in both 2025 and 2026 and remains in effect until June 2029. As of September 30, 2026, 2,347,752 shares were repurchased by the Company under its Share Repurchase Program and held as treasury stock. The Company has approximately $79.8 million remaining under the authorized Share Repurchase Program as of September 30, 2026. The specific timing and amounts of the repurchases will be in the sole discretion of the Company and may vary based on market conditions and other factors. The Company is not obligated under the terms of the program to repurchase any of its common shares.
Issuance of shares
During the nine months ended September 30, 2026, the Company issued 8,772,390 shares under its dividend reinvestment plan (“DRIP”) and At-the-Market Sales Agreement (“ATM”) for total consideration of $100.0 million.
During the nine months ended September 30, 2026, the Company issued a total of 458,238 new shares following the exercise of 594,999 share options. (See also Note 11: Share Option Plan).
Therefore, there were 153,793,555 common shares outstanding as of September 30, 2026 (December 31, 2025: 144,562,927), excluding shares held in treasury.
Dividends
During the nine months ended September 30, 2026, the Company declared a dividend of $0.20 per share on February 11, 2026, which was paid in cash on March 30, 2026. The record date and ex-dividend date were March 12, 2026. The Company declared a dividend of $0.22 per share on May 12, 2026, which was paid in cash on June 22, 2026. The record date and ex-dividend date were May 27, 2026. The Company declared a dividend of $0.22 per share on August 26, 2026, which was paid in cash on September 22, 2026. The record date and ex-dividend date were September 9, 2026.
11.SHARE OPTION PLAN
During the nine months ended September 30, 2026, 594,999 share options were exercised. The Company issued a total of 458,238 new shares in full satisfaction of the options exercised which had a total intrinsic value of $3.9 million on the day of exercise. The weighted average exercise price of the options exercised was $5.12 per share.
In February 2026, the Company awarded a total of 615,000 options to officers, employees and directors, pursuant to the Company’s share option plan. The options have a five-year term and a three-year vesting period and the first options will be exercisable from February 2027 onwards. The initial strike price was $10.48 per share.
19
12.RELATED PARTY TRANSACTIONS
The unaudited condensed consolidated balance sheets include the following amounts due from and to related parties and associated companies.
| (in thousands of $) | September 30, 2026 | December 31, 2025 | |||||||||
| Amounts due from: | |||||||||||
| Frontline | 2,293 | 3,816 | |||||||||
| Seatankers | 572 | 736 | |||||||||
| Front Ocean | 20 | — | |||||||||
| Paratus | 2 | 3 | |||||||||
| Northern Ocean | 15 | 2,120 | |||||||||
| NorAm Drilling | 219 | 175 | |||||||||
| River Box | 118 | 110 | |||||||||
| Other related parties | 3 | 3 | |||||||||
| Allowance for expected credit losses | (20) | (22) | |||||||||
| Total amount due from related parties | 3,222 | 6,941 | |||||||||
| Loans to related parties - associated companies, long-term | |||||||||||
| River Box | 45,000 | 45,000 | |||||||||
| Total loans to related parties - associated companies, long-term | 45,000 | 45,000 | |||||||||
| Amounts due to: | |||||||||||
| Frontline | 2,174 | 1,096 | |||||||||
| Seatankers | 99 | 105 | |||||||||
| Front Ocean | — | 97 | |||||||||
| Other related parties | 5 | 5 | |||||||||
| Total amount due to related parties | 2,278 | 1,303 | |||||||||
Related party leasing and service contracts
The Company’s most significant related party leasing and service contracts were with Golden Ocean Group Limited (“Golden Ocean”), a company related to Hemen Holding Limited (“Hemen”) until March 12, 2025, to whom the Company leased eight vessels. Until March 12, 2025, the Company received operating lease income of $10.7 million and paid vessels management fees of $4.0 million. In February 2025, the Company announced that Golden Ocean had exercised its purchase options on eight Capesize vessels for net selling proceeds of $114.1 million. The vessels were delivered to Golden Ocean in July 2025.
During the nine months ended September 30, 2026, the Company earned $0.6 million from the sale of parts and leasing of equipment from the drilling rig Hercules to Northern Ocean Operations Ltd. (“Northern Ocean”) (nine months ended September 30, 2025: $1.7 million). In addition, in 2025, the Company entered into a promissory note with Northern Ocean in respect of a credit given by SFL for an amount of $2.1 million. The note bore interest at a rate of 12% per annum and had a term of one year. The note was settled in July 2026. During the nine months ended September 30, 2026, the Company earned interest income of $0.1 million in relation to the promissory note (nine months ended September 30, 2025: $0.1 million).
During the nine months ended September 30, 2026, the Company paid Frontline plc and its subsidiaries (collectively, “Frontline”), a management fee of 1.25% of chartering revenues in relation to two Suezmax tankers operating in the spot market. As of September 30, 2026, Frontline owed the Company $0.1 million in respect of charter hire receivables arising from the commercial management of those vessels.
Other related party service contracts include payments to Front Ocean Management AS and Front Ocean Management Ltd. (“Front Ocean”), Seatankers Management Norway AS and Seatankers Management Co. Ltd. (“Seatankers”), Frontline and Paratus Management (UK) Ltd. (“Paratus”) for office facilities, administration service fees, newbuilding supervision fees and vessel management fees.
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Related parties – associated companies
The Company granted a $45.0 million non-amortizing loan to River Box Holding Inc. (“River Box”) which bears a fixed interest rate and is repayable in full on November 16, 2033 or earlier if River Box sells its assets. During the nine months ended September 30, 2026, the Company recognized interest income of $3.4 million (nine months ended September 30, 2025: $3.4 million).
Other related party transactions
During the nine months ended September 30, 2026, the Company recognized dividend income of $0.4 million from NorAm Drilling (nine months ended September 30, 2025: $0.4 million).
13.COMMITMENTS AND CONTINGENT LIABILITIES
Assets Pledged
| (in millions of $) | September 30, 2026 | December 31, 2025 | ||||||
| Vessels, rigs and equipment, net | 2,917 | 2,820 | ||||||
| Book value of consolidated assets pledged under mortgages | 2,917 | 2,820 | ||||||
The Company has funded its acquisition of vessels, jack-up rig and harsh environment semi-submersible rig through a combination of equity, short-term debt and long-term debt. Providers of long-term loan facilities usually require that the loans be secured by mortgages against the assets being acquired.
Other Contractual Commitments and Contingencies
The Company has obtained insurance coverage for legal liability risks arising from its shipping activities through mutual protection and indemnity associations, which are members of the International Group of P&I clubs. As a member of these mutual associations, the Company is subject to calls payable to the associations based on its claims record, in addition to the claims records of all other members of the associations. A contingent liability exists if the claims records of the members of the associations significantly deteriorates, which may result in additional calls on the members.
Capital commitments
As of September 30, 2026, the Company had remaining contractual payment commitments totaling $1,426.0 million under shipbuilding contracts and vessel purchase agreements in relation to five newbuilding dual-fuel 16,800 TEU container vessels, four newbuilding dual-fuel 7,000 CEU car carriers and two 8,800 TEU container vessels (December 31, 2025: $848.1 million in relation to five newbuilding dual-fuel 16,800 TEU container vessels). The vessels are expected to be delivered to the Company between 2027 and 2029.
Also as of September 30, 2026, the Company has committed to pay $11.9 million for capital upgrades on the drilling rig, Hercules (December 31, 2025: $12.9 million). The installations are expected to take place in 2026.
Other contingencies
In 2023, the Company’s rig-owning subsidiary brought a claim against certain subsidiaries of Seadrill Ltd. (“Seadrill”) concerning the condition of the drilling rig Hercules upon its redelivery in 2022. The Oslo District Court ruled in the Company’s favor in February 2025, and Seadrill appealed. In October 2026, the Borgarting Court of Appeal delivered a unanimous judgment finding that Seadrill had breached the contract on redelivery. The Court ordered Seadrill to pay the Company’s subsidiary a total of approximately $55.0 million, including compensation, late payment interest and legal costs.
In a related dispute over capital spares supplied for Hercules, the Oslo District Court ruled in the Company’s favor in April 2025, and Seadrill appealed. In October 2026, the Borgarting Court of Appeal reversed that ruling and ordered the Company to pay Seadrill approximately $12.0 million, including compensation, late payment interest and legal costs.
Neither outcome is final as each judgment may be appealed to the Supreme Court of Norway within 30 days of service, subject to leave to appeal being granted.
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The Company has not recognized any gain or loss in the unaudited condensed consolidated financial statements as of September 30, 2026 in respect of these rulings.
The Company is routinely party both as plaintiff and defendant to lawsuits in various jurisdictions under charter hire obligations arising from the operation of its vessels in the ordinary course of business. The Company believes that the resolution of such claims will not have a material adverse effect on its results of operations or financial position. The Company has not recognized any contingent gains or losses arising from the pending results of any such lawsuits.
The Company has issued performance guarantees in the normal course of business in connection with certain vessel charter and rig arrangements. These guarantees relate to the Company’s obligations under the underlying agreements and may be triggered by claims arising thereunder. The maximum potential amount of future payments under these guarantees is not contractually limited and is dependent upon the nature and extent of claims, if any, under the related agreements. The Company has not recognized any contingent gains or losses arising from these guarantees, as management believes the likelihood of payment is remote.
14.SUBSEQUENT EVENTS
On November 4, 2026, the Board of Directors of the Company declared a dividend of $0.22 per share which is payable in cash on or around December 28, 2026 to shareholders of record as of December 15, 2026.
In October 2026, the Company entered into agreements to sell four 2014-built and 2015-built LR2 product tankers and three 2019-built Suezmax tankers to the existing charterer. The vessels are expected to be delivered to the buyer during the fourth quarter of 2026 and the first quarter of 2027, at which time the existing charter agreements will terminate.
In October 2026, the Company entered into agreements for the construction and long-term chartering of three 93,000 cbm dual-fuel Very Large Ammonia Carriers or VLACs. The VLACs are expected to be delivered from the second quarter of 2028. Two of the vessels will be chartered to an investment-grade oil major. The duration of the initial charter period will be determined within six months of entering into the agreements, and the charterer has options to extend the charters by up to four years. The third vessel will be chartered to a global leader in the commodities industry for a minimum period of five years from delivery, with options to extend the charter by up to two years. The charterer will also have an option to purchase the vessel during the final two years of the fixed charter period, subject to a profit-sharing arrangement with the Company.
Also in October 2026, the Company entered into long-term time charter agreements for two 8,800 TEU container vessels which are expected to be delivered in 2027 and will commence eight-year firm time charters with a leading liner company upon delivery. The charterer has options to extend each charter by up to four years and purchase options at the end of years eight, 10 and 12, including a profit share feature.
Following these agreements, the Company’s aggregate remaining purchase and construction commitments under its newbuilding program and committed vessel acquisitions were approximately $1.7 billion.
In October 2026, the Borgarting Court of Appeal ruled in the Company’s favor in the Hercules redelivery dispute with Seadrill and against the Company in a related capital spares dispute. The judgments remain subject to appeal. See Note 13: Commitments and Contingent Liabilities, for further details.
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SFL CORPORATION LTD
As used herein, “we,” “us,” “our” and “the Company” all refer to SFL Corporation Ltd. and its subsidiaries. This management’s discussion and analysis of financial condition and results of operations should be read together with the discussion included in the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2025.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
for the nine months ended September 30, 2026
General
We are SFL Corporation Ltd., a Bermuda-based company incorporated in Bermuda on October 10, 2003, as a Bermuda exempted company under the Bermuda Companies Law of 1981 (Company No. EC-34296). We are engaged primarily in the ownership and operation of vessels and offshore related assets, and also involved in the charter, purchase and sale of assets. Our registered and principal executive offices are located at Par-la-Ville Place, 14 Par-la-Ville Road, Hamilton, HM 08, Bermuda, and our telephone number is +1 (441) 295-9500.
We operate through subsidiaries and branches located in Bermuda, Canada, Cyprus, Liberia, Namibia, Norway, Singapore, the United Kingdom and the Marshall Islands.
You should carefully consider the risks and other important factors described under the heading “Risk Factors” in the Company’s Annual Report on Form 20-F for the year ended December 31, 2025, as well as those described from time to time in the reports filed by the Company with the U.S. Securities and Exchange Commission (the “SEC”).
Recent and Other Developments
Acquisitions, Deliveries, Capital Investments and Disposals
Acquisitions, Deliveries and Capital Investments
During the nine months ended September 30, 2026, we recorded $25.1 million for capital upgrades performed on three container vessels, two chemical tankers and one rig.
Between May and August 2026, we entered into agreements for the construction of four LNG dual-fuel 7,000 CEU car carriers, with expected delivery in 2029. The aggregate contract price for the four vessels is approximately $363.1 million. Two newbuildings have been agreed to be chartered on long-term charters to a major Asia-based car manufacturer, while the remaining two newbuildings are expected to be chartered closer to their respective delivery dates.
In October 2026, the Company entered into agreements for the construction and long-term chartering of three 93,000 cbm dual-fuel Very Large Ammonia Carriers or VLACs. The VLACs are expected to be delivered from the second quarter of 2028. Two of the vessels will be chartered to an investment-grade oil major. The duration of the initial charter period will be determined within six months of entering into the agreements, and the charterer has options to extend the charters by up to four years. The third vessel will be chartered to a global leader in the commodities industry for a minimum period of five years from delivery, with options to extend the charter by up to two years. The charterer will also have an option to purchase the vessel during the final two years of the fixed charter period, subject to a profit-sharing arrangement with the Company.
Also in October 2026, the Company entered into long-term time charter agreements for two 8,800 TEU container vessels which are expected to be delivered in 2027 and will commence eight-year firm time charters with a leading liner company upon delivery. The charterer has options to extend each charter by up to four years and purchase options at the end of years eight, 10 and 12, including a profit share feature.
Following these agreements, the Company’s aggregate remaining purchase and construction commitments under its newbuilding program and committed vessel acquisitions were approximately $1.7 billion.
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Disposals
In February 2026, we delivered the 2015-built Suezmax vessel, SFL Thelon, to an unrelated third party for net sale proceeds of $48.3 million and recorded a gain of $11.5 million on the disposal.
In October 2026, the Company entered into agreements to sell four 2014-built and 2015-built LR2 product tankers and three 2019-built Suezmax tankers to the existing charterer. The vessels are expected to be delivered to the buyer during the fourth quarter of 2026 and the first quarter of 2027, at which time the existing charter agreements will terminate.
New Contracts, Extensions and Changes
In March 2026, we entered into a drilling contract in Canada with a large, investment-grade multinational oil and gas company for the harsh environment semi-submersible rig Hercules. The contract has an estimated value of approximately $170.0 million, a minimum term of approximately 400 days, with several options to extend up to 280 days and is expected to commence in the first quarter of 2027.
Between March and October 2026, three 9,500 TEU container vessels commenced new time charter contracts with Maersk for a duration of five years.
In May 2026, we entered into three-year time charter agreements with a leading global liner company based in Asia for two 6,500 CEU car carriers. The charters are scheduled to commence upon the expiration of the existing charters, which are set to expire at the end of 2026 and early 2027, respectively.
In June 2026, Phillips 66 declared additional 12-month extension options for two product tankers.
In September 2026, we agreed new time charter contracts with Hapag Lloyd for six 15,400 TEU container vessels for a duration of seven years.
In October 2026, the Suezmax tanker SFL Albany commenced a three-year time charter with an investment-grade oil major.
Debt and Lease Debt Financing
In March 2026, we fully repaid the $150.0 million senior secured term loan facility secured by the jack-up drilling rig Linus and fully drew down a $150.0 million three-year senior secured revolving credit facility, which was entered into in February 2026 as part of the refinancing.
In March 2026, one of our wholly owned subsidiaries entered into a $100.0 million two-year senior secured revolving credit facility bearing interest at SOFR plus an applicable margin in connection with the Hercules rig.
In April 2026, we completed a $75.0 million tap issue of an existing senior unsecured sustainability-linked bond in the Nordic credit market. The tap issue was priced at 103.5% of face value and, together with the previously outstanding bonds, bears a coupon of 7.75% and will mature in 2030. The net proceeds were used for general corporate purposes.
In May 2026, we fully repaid the $150.0 million senior unsecured sustainability-linked bonds due 2026. The repaid bonds bore quarterly interest at a fixed rate of 7.25% per annum and were redeemable in full on May 12, 2026.
Issuance/Repurchase of Shares, Share Options, Grants and Exercises
During the nine months ended September 30, 2026, we issued 458,238 new shares to employees, officers and directors upon the exercise of share options granted in prior years under the Company’s incentive program.
In February 2026, 615,000 options were awarded to employees, officers and directors, pursuant to the Company's Share Option Scheme. The options have a five-year term and a three-year vesting period and the first options are exercisable from February 2027 onwards. The initial strike price was $10.48 per share.
Also during the nine months ended September 30, 2026, we issued 8,772,390 common shares under our dividend reinvestment plan (“DRIP”) and At-the-Market Sales Agreement (“ATM”) for total consideration of $100.0 million.
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Dividend
During the nine months ended September 30, 2026, we declared a dividend of $0.20 per share on February 11, 2026, which was paid in cash on March 30, 2026. The record date and ex-dividend date were March 12, 2026. We declared a dividend of $0.22 per share on May 12, 2026, which was paid in cash on June 22, 2026. The record date and ex-dividend date were May 27, 2026. We also declared a dividend of $0.22 per share on August 26, 2026 which was paid in cash on September 22, 2026. The record date and ex-dividend date were September 9, 2026.
On November 4, 2026, the Board of Directors of the Company declared a dividend of $0.22 per share which is payable in cash on or around December 28, 2026 to shareholders of record as of December 15, 2026.
Any dividend that we declare is at the discretion of our Board of Directors. We cannot assure you that our dividend will not be reduced or eliminated in the future, and changes in our dividend policy could adversely affect the market price of our common shares.
Corporate and other matters
In October 2026, the Borgarting Court of Appeal ruled in the Company’s favor in the Hercules redelivery dispute with Seadrill and against the Company in a related capital spares dispute. The judgments remain subject to appeal. See Note 13: Commitments and Contingent Liabilities, for further details.
Trade Route Disruptions
Continuing hostilities, including those involving Israel and Iran in 2026, and reported attacks on commercial vessels in and around the Red Sea, Bab al-Mandab Strait, Persian Gulf, Gulf of Oman and Strait of Hormuz have increased security, navigation and insurance risks and may disrupt trading patterns and access to strategic waterways. Although international maritime transit routes through the Strait of Hormuz currently remain open and commercial vessels continue to transit the area, regional tensions, military activity, security incidents and the risk of further escalation continue to create uncertainty for global shipping markets. The security environment in the region remains fluid and difficult to predict, and any further escalation of hostilities, military activity, geopolitical tensions or disruption to shipping lanes could adversely affect global trade flows, vessel utilization, operating costs, insurance premiums, fuel consumption and charter market conditions. Such events may also result in delays, increased transit times, port restrictions, changes in trade patterns and reduced availability of marine insurance on commercially reasonable terms. As of the date of this report, the Company’s vessels and contracts have not been materially affected by events in the Red Sea, Bab al-Mandab Strait, Persian Gulf, Gulf of Oman and Strait of Hormuz.
Operating Results
| Nine months ended | Nine months ended | ||||||||||
| (in thousands of $) | September 30, 2026 | September 30, 2025 | |||||||||
| Total operating revenues | 576,829 | 557,534 | |||||||||
| Gain on sale of vessels | 11,503 | 4,530 | |||||||||
| Total operating expenses | (410,731) | (457,198) | |||||||||
| Operating income | 177,601 | 104,866 | |||||||||
| Interest income | 7,591 | 10,276 | |||||||||
| Interest expense | (109,179) | (137,589) | |||||||||
| Other non-operating items, net | 21,056 | 41 | |||||||||
| Equity in earnings of associated companies | 1,761 | 1,754 | |||||||||
| Tax expense | (1,609) | (1,126) | |||||||||
| Net income/(loss) | 97,221 | (21,778) | |||||||||
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Total operating revenues
Total operating revenues increased by 3.5% in the nine months ended September 30, 2026, compared with the same period in 2025.
| Nine months ended | Nine months ended | ||||||||||
| (in thousands of $) | September 30, 2026 | September 30, 2025 | |||||||||
| Time charter revenues | 409,090 | 458,084 | |||||||||
| Voyage charter and pool revenues | 72,865 | 12,831 | |||||||||
| Drilling contract revenues | 70,397 | 72,785 | |||||||||
| Interest income - sales-type leases | — | 951 | |||||||||
| Profit sharing income | 6,065 | 4,410 | |||||||||
| Other operating income | 18,412 | 8,473 | |||||||||
| Total operating revenues | 576,829 | 557,534 | |||||||||
Time charter revenues
During the nine months ended September 30, 2026, time charter revenues were earned by 21 container vessels, seven car carriers, two dry bulk carriers, four Suezmax tankers, nine product tankers and one chemical tanker. The 11% decrease in time charter revenues for the nine months ended September 30, 2026, compared with the same period in 2025, was mainly attributable to the sale of one container vessel, 13 dry bulk carriers, one Suezmax tanker during 2025 and the sale of another Suezmax tanker in the nine months ended September 30, 2026. In addition, two Suezmax tankers were redelivered from their charters at the end of 2025 and have been trading in the spot market in 2026.
Voyage charter and pool revenues
During the nine months ended September 30, 2026, voyage charter and pool revenues were earned by one dry bulk carrier which is sometimes chartered on a voyage-by-voyage basis, two Suezmax tankers which commenced trading in the spot market at the start of 2026, and one chemical tanker trading in a pool. During the nine months ended September 30, 2025, voyage charter and pool revenues were earned by five dry bulk carriers which were occasionally chartered on a voyage-by-voyage basis and one chemical tanker trading in a pool. Voyage charter and pool revenues increased by $60.0 million in the nine months ended September 30, 2026, compared to the same period in 2025, mainly due to higher spot earnings from the two Suezmax tankers that were previously on long term time charters.
Drilling contract revenues
We earn drilling contract revenues from our two drilling rigs. The drilling rig Linus has been operational with ConocoPhillips since its redelivery from Seadrill in September 2022. The drilling rig Hercules completed its drilling contract with Equinor in October 2024 and then moved to Norway where it has remained stacked until September 30, 2026, pending commencement of a new drilling contract. Drilling contract revenues decreased by 3% in the nine months ended September 30, 2026, compared to the same period in 2025, mainly because the comparative period included revenue recognized by Hercules in connection with the settlement of a historical revenue claim.
Interest income - sales-type leases
In the nine months ended September 30, 2026, we did not earn any sales-type lease interest income. In the nine months ended September 30, 2025, we earned sales-type lease interest income on seven container vessels on long-term charters to Mediterranean Shipping Company S.A. and its affiliate Conglomerate Shipping Ltd. or MSC, all of which were sold between June and July 2025.
Profit share revenues
During the nine months ended September 30, 2026, we recorded $6.1 million from fuel saving arrangements relating to seven container vessels on charter to Maersk, arising from the installation of scrubbers, and one scrubber-fitted car carrier on charter to Eukor Car Carriers Inc. (nine months ended September 30, 2025: $3.8 million relating to seven container vessels and one car carrier).
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We also had a profit share arrangement related to the eight Capesize dry bulk vessels which were on charter to a subsidiary of Golden Ocean until their disposal in July 2025, under which we earned a 33% profit share above the base charter rates, calculated and paid on a quarterly basis. In the nine months ended September 30, 2025, we recognized $0.6 million of profit share revenue under this arrangement.
Other operating income
During the nine months ended September 30, 2026, we recorded other operating income of $18.4 million compared with $8.5 million for the nine months ended September 30, 2025. Other operating income mainly relates to rebates from suppliers, settlement of charter disputes including insurance claims and recharges to charterers for additional costs such as security costs, war risk insurance and crew bonuses. The increase in other operating income was driven by higher recharges to charterers for costs in the period.
Gain on sale of vessels
In the nine months ended September 30, 2026, we recorded a net gain of $11.5 million relating to the disposal of one Suezmax tanker.
In the nine months ended September 30, 2025, we recorded a net gain of $4.5 million in relation to the disposal of one 1,700 TEU container vessel, five 57,000 dwt Supramax dry bulk vessels, eight 180,000 dwt Capesize dry bulk vessels, and seven 4,100 TEU container vessels which were previously accounted for as sales-type leases.
Operating expenses
| Nine months ended | Nine months ended | ||||||||||
| (in thousands of $) | September 30, 2026 | September 30, 2025 | |||||||||
| Vessel and rig operating expenses | 226,791 | 230,817 | |||||||||
| Depreciation | 165,514 | 178,702 | |||||||||
| Vessel impairment charge | — | 34,093 | |||||||||
| Administrative expenses | 18,426 | 13,586 | |||||||||
| Total operating expenses | 410,731 | 457,198 | |||||||||
Vessel and rig operating expenses decreased by $4.0 million in the nine months ended September 30, 2026, compared with the same period in 2025. The decrease is mainly due to the sale of one container vessel, 13 dry bulk carriers, one Suezmax tanker during 2025 and the sale of another Suezmax tanker in the nine months ended September 30, 2026. In addition, drydock costs were lower because only four vessels were drydocked in the nine months ended September 30, 2026, compared to 15 vessels in the same period in 2025. The decrease was slightly offset by an increase in the operating costs for our two drilling rigs in the nine months ended September 30, 2026, compared to the same period in 2025. The increase in the operating costs for Linus is largely attributable to elevated operational costs in 2026 compared to 2025, while the increase for Hercules is a result of increased activity for its re-activation due to its new contract scheduled to commence in early 2027.
Depreciation expense decreased by 7% for the nine months ended September 30, 2026, compared to the same period in 2025, mainly due to the sale of one container vessel, 13 dry bulk carriers, one Suezmax tanker during 2025 and the sale of another Suezmax tanker in the nine months ended September 30, 2026. This was partially offset by the addition of capital upgrades on 14 container vessels, one car carrier, one chemical tanker, four Suezmax tankers and two drilling rigs in 2025.
No impairment charge was recorded in the nine months ended September 30, 2026. In the nine months ended September 30, 2025, we recorded an impairment loss of $34.1 million on seven dry bulk carriers, based on the estimated fair value of the vessels using a market approach. The impairment charge was primarily triggered by updated expectations on the timing of potential disposal of the vessels, future estimated cash flows based on current market conditions and outlook, and amounts of disposal proceeds expected to be received. The increasing estimated future costs stemming from U.S. and international trade policies, including tariffs and port fees, negatively impacted estimated future earnings and values of the vessels in 2025.
Administrative expenses for the nine months ended September 30, 2026 increased by $4.8 million compared with the same period in 2025, mainly due to higher legal and professional fees arising from business activities such as vessel financing and contracting, as well as legal fees related to the Seadrill appeal proceedings.
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Interest income
Total interest income decreased by $2.7 million for the nine months ended September 30, 2026, compared to the same period in 2025, mainly due to lower interest earned on bank deposits and short-term investments.
Interest expense
Interest expense for the nine months ended September 30, 2026, was $109.2 million compared with $137.6 million for the nine months ended September 30, 2025. The decrease in interest expense for the nine months ended September 30, 2026, compared to the same period in 2025, is mainly due to lower benchmark interest rates, particularly SOFR, which reduced borrowing costs on U.S. dollar floating-rate debt. Changes in interest related to the bonds are due to movements in foreign currency exchange rates, repayments and redemptions.
Other non-operating items
| Nine months ended | Nine months ended | ||||||||||
| (in thousands of $) | September 30, 2026 | September 30, 2025 | |||||||||
| Gain/(Loss) on investments in equity securities | 1,469 | (768) | |||||||||
| Interest and valuation gain/(loss) on non-designated derivatives | 21,276 | (2,808) | |||||||||
| Other financial items, net | (1,689) | 3,617 | |||||||||
| Total other non-operating items | 21,056 | 41 | |||||||||
In the nine months ended September 30, 2026, total other non-operating items amounted to a gain of $21.1 million compared to a gain of $41,000 in the nine months ended September 30, 2025. This movement is mainly affected by a gain on valuation of non-designated derivatives and a gain on investment in equity securities. The gains are offset by less favorable foreign exchange fluctuations.
Equity in earnings of associated companies
River Box holds investments in direct financing leases, through its subsidiaries, related to the 19,200 and 19,400 TEU containerships MSC Anna, MSC Viviana, MSC Erica and MSC Reef. The Company holds a 49.9% equity interest in River Box. The investment is accounted for under the equity method. The remaining 50.1% of the shares of River Box are held by a subsidiary of Hemen, the Company’s largest shareholder and a related party. The net income of the River Box group is included under “Equity in earnings of associated companies” during the nine months ended September 30, 2026 and September 30, 2025. The total equity in earnings of associated companies in the nine months ended September 30, 2026, was $1.8 million (nine months ended September 30, 2025: $1.8 million).
Tax expense
In the nine months ended September 30, 2026, we recorded a tax expense of $1.6 million, which relates mainly to the operations of the drilling rig Linus in Norway. In the nine months ended September 30, 2025, we recorded a tax expense of $1.1 million, mainly due to the operations of Linus in Norway.
Liquidity and Capital Resources
As of September 30, 2026, we had total cash and cash equivalents of $111.9 million and investments in debt and equity securities of $6.0 million.
In the nine months ended September 30, 2026, we generated net cash of $209.7 million from operating activities, used net cash of $13.1 million in investing activities and used net cash of $235.5 million in financing activities.
Cash flows provided by operating activities for the nine months ended September 30, 2026 decreased to $209.7 million from $215.6 million for the same period in 2025, mainly due to changes in operating income and the timing of charter hire and collections of trade and other receivables.
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Investing activities used cash of $13.1 million in the nine months ended September 30, 2026, compared to $143.1 million generated in the same period in 2025. The change to net cash used by investing activities in the nine months ended September 30, 2026, compared to cash generated in the same period in 2025, is primarily attributable to lower proceeds from vessel sales, partially offset by higher asset related receipts from government grants and insurance proceeds. During the nine months ended September 30, 2026, we received $48.3 million from the sale of one Suezmax tanker, compared to $209.5 million from the sale of eight container vessels and 13 dry bulk carriers in the comparable period in 2025. In addition, proceeds from government grants and insurance proceeds relating to one of our drilling rigs totaled $12.6 million in the nine months ended September 30, 2026, compared to $4.8 million in the same period in 2025. Cash outflows totaling $73.9 million comprised $47.1 million towards the newbuilding program and $26.8 million primarily related to capital upgrades for three container vessels, two chemical tankers, and two drilling rigs. In comparison, cash outflows totaling $71.1 million in the same period in 2025 comprised $6.4 million towards the newbuilding program and $64.7 million primarily related to capital upgrades for 16 container vessels, six tankers, one car carrier and two drilling rigs.
Net cash used in financing activities was $235.5 million for the nine months ended September 30, 2026, compared to $215.0 million used in the same period in 2025. The increase was primarily driven by higher debt repayments, which totaled $553.3 million, compared to $341.2 million in the comparable period in 2025. The increase was partially offset by debt proceeds amounting to $305.6 million in the nine months ended September 30, 2026, compared to $244.0 million in the same period in 2025. Additionally, a cash inflow of $100.5 million was generated primarily from the issuance of 8,772,390 common shares under the DRIP and ATM, whereas in the same period in 2025, we incurred a $10.0 million cash outflow from share repurchases. There were no cash outflows in the nine months ended September 30, 2026 related to swap settlements, compared to $6.3 million in the same period in 2025. Furthermore, dividends paid amounted to $87.5 million in the nine months ended September 30, 2026, compared to $98.6 million in the same period in 2025.
In addition to bank loans, we continually monitor equity and debt capital market conditions and may raise additional capital through the issuance of equity, debt or hybrid securities from time to time.
In March 2026, one of our wholly-owned subsidiaries entered into a $100.0 million senior secured revolving credit facility in connection with the Hercules rig. The facility bears interest at SOFR plus an applicable margin. In addition, we maintain a general share lending agreement that provides access to up to $60.0 million in cash collateral, callable at any time, in connection with the shares lent.
A significant portion of our outstanding debt will be due within one year of this report for which we have already initiated discussions and negotiations with financial institutions regarding the refinancing of such maturing credit facilities. Given our finance structure, we will, as expected, consistently have significant debt maturities due within a twelve-month period that have not yet been refinanced. The Company expects to address these maturities through a combination of refinancing, available liquidity and cash generated from operations. With our extensive history and successful track record in securing financing and refinancing, we believe that we will be reasonably able to obtain the necessary refinancing for these facilities on or before their maturity. However, no assurance can be given that all such facilities will be timely refinanced on acceptable terms or at all.
The following table presents an overall summary of our borrowings as of September 30, 2026.
| Outstanding balance | ||||||||
| (in millions of $) | as of September 30, 2026 | |||||||
| Unsecured borrowings: | ||||||||
| 8.875% senior unsecured sustainability-linked bonds due 2027 | 150.0 | |||||||
| 8.25% senior unsecured sustainability-linked bonds due 2028 | 147.6 | |||||||
| NOK750 million senior unsecured floating rate bonds due 2029 | 77.9 | |||||||
| 7.75% senior unsecured sustainability-linked bonds due 2030 | 225.0 | |||||||
| Total bonds | 600.5 | |||||||
| Lease debt financing | 626.4 | |||||||
| U.S. dollar denominated floating rate debt | 1,120.3 | |||||||
| Total borrowings | 2,347.2 | |||||||
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As of September 30, 2026, we hold an equity interest in River Box, within which a 49.9% proportion of the direct financing lease receivables and finance lease liabilities amounted to $194.2 million and $157.6 million respectively.
Agreements related to long-term debt provide limitations on the amount of total borrowings and secured debt, and acceleration of payment under certain circumstances, including failure to satisfy certain financial covenants. As of September 30, 2026, we were in compliance with all of the covenants contained in our financing agreements.
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Matters discussed in this report and the documents incorporated by reference may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include, but are not limited to, statements concerning plans, objectives, goals, strategies, future events or performance, underlying assumptions and other statements, which are other than statements of historical facts.
These statements reflect the Company’s current views with respect to future events and financial performance and are not intended to give any assurance as to future results. When used in this document, the words “believe,” “anticipate,” “intend,” “estimate,” “forecast,” “project,” “plan,” “potential,” “will,” “may,” “should,” “expect,” “targets,” “likely,” “would,” “could” “seeks,” “continue,” “possible,” “might,” “pending” and similar expressions, terms or phrases may identify forward-looking statements.
The forward-looking statements herein are based upon various assumptions, many of which are based, in turn, upon further assumptions, including, without limitation, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, the Company cannot assure you that it will achieve or accomplish these expectations, beliefs or projections.
Such statements reflect the Company’s current views with respect to future events and are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. The Company is making investors aware that such forward-looking statements, because they relate to future events, are by their very nature subject to many important factors that could cause actual results to differ materially from those contemplated. In addition to these important factors and matters discussed elsewhere herein, important factors that, in the Company’s view, could cause actual results to differ materially from those discussed in the forward-looking statements include, but are not limited to:
▪the strength of world economies and currencies;
▪inflationary pressures and central bank policies intended to combat overall inflation and rising interest rates and foreign exchange rates;
▪the Company’s ability to generate cash to service its indebtedness;
▪the Company’s ability to continue to satisfy its financial and other covenants, or obtain waivers relating to such covenants from its lenders under its credit facilities;
▪the availability of financing and refinancing, as well as the Company’s ability to obtain such financing or refinancing in the future to fund capital expenditures, acquisitions and other general corporate activities and the Company's ability to comply with the restrictions and other covenants in its financing arrangements;
▪the Company’s counterparties’ ability or willingness to honor their obligations under agreements with it;
▪general market conditions in the seaborne transportation industry, which is cyclical and volatile, including fluctuations in charter hire rates and vessel values;
▪prolonged or significant downturns in the tanker, dry-bulk carrier, container, car carrier and/or offshore drilling charter markets;
▪the volatility of oil and gas prices, which affects, among other things, several sectors of the maritime, shipping and offshore industries, including oil transportation, dry bulk shipments, oil products transportation, car transportation and drilling rigs;
▪a decrease in the value of the market values of the Company’s vessels and drilling rigs;
▪an oversupply of vessels, including drilling rigs, which could lead to reductions in charter hire rates and profitability;
▪any inability to retain and recruit qualified key executives, key employees, key consultants or skilled workers;
▪the potential difference in interests between or among certain of the Company’s directors, officers, key executives and shareholders, including Hemen Holding Limited, or Hemen, our largest shareholder;
▪the risks associated with the purchase of second-hand vessels;
▪the aging of the Company’s fleet which could result in increased operating costs, impairment or loss of hire;
▪the adequacy of insurance coverage for inherent operational risks, and the Company’s ability to obtain indemnities from customers, changes in laws, treaties or regulations;
▪changes in supply and generally the number, size and form of providers of goods and services in the markets in which the Company operates;
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▪the supply of and demand for oil and oil products and vessels, including drilling rigs, comparable to ours, including against the background of the possibility of accelerated climate change transition worldwide, including shifts in consumer demand for other energy resources could have an accelerated negative effect on the demand for oil and thus its transportation and drilling;
▪changes in market demand in countries which import commodities and finished goods and changes in the amount and location of the production of those commodities and finished goods and resulting changes to trade patterns;
▪delays or defaults by the shipyards in the construction of our newbuildings;
▪uncertainty regarding the adoption of ammonia and other alternative marine fuels;
▪technological innovation in the sectors in which we operate and quality and efficiency requirements from customers;
▪technology risk associated with energy transition and fleet/systems rejuvenation to alternative propulsions;
▪cost and effects of cybersecurity incidents or other failures, interruptions, or security breaches of our systems or those of our customers or third-party providers, including software failures, unforeseeable security breaches, or incidents stemming from the misuse or intentional or unintentional misapplication of artificial intelligence in our business;
▪our ability to comply with, and the expected cost of, governmental regulations and maritime self-regulatory organization standards, including new environmental regulations and standards, as well as standard regulations imposed by our charterers applicable to our business;
▪governmental laws and regulations, including environmental regulations, that add to our costs or the costs of our customers;
▪potential liability from safety, environmental, governmental and other requirements and potential significant additional expenditures related to complying with such regulations;
▪the impact of increasing scrutiny and changing expectations from investors, lenders, charterers and other market participants with respect to our Environmental, Social and Governance, or ESG, practices;
▪increased inspection procedures and more restrictive import and export controls;
▪the imposition of sanctions by the Office of Foreign Assets Control of the Department of the U.S. Treasury or pursuant to other applicable laws or regulations imposed by the U.S. government, the European Union, the United Nations or other governments against the Company or any of its subsidiaries;
▪compliance with governmental, tax, environmental and safety regulation, any non-compliance with the U.S. Foreign Corrupt Practices Act of 1977 or other applicable regulations relating to bribery;
▪changes in the Company’s operating expenses, including bunker prices, drydocking and insurance costs;
▪fluctuations in currencies and interest rates such as Norwegian Interbank Offered Rate, or NIBOR, and Secured Overnight Financing Rate, or SOFR;
▪the impact that any discontinuance, modification or other reform or the establishment of alternative reference rates may have on our floating interest rate debt instruments;
▪the volatility of prevailing spot market charter rates, which affects the amount of profit sharing payment the Company receives under our charters;
▪the volatility or adverse conditions in global capital markets that may limit the Company’s ability to issue equity or debt securities on favorable terms, including through at‑the‑market programs or follow‑on offerings;
▪changes in the Company’s dividend policy;
▪the future sale and volatility of the price of the Company’s common shares;
▪the failure to protect the Company’s information security management system against security breaches, or the failure or unavailability of these systems for a significant period of time;
▪the entrance into transactions that expose the Company to additional risk outside of its core business;
▪difficulty managing planned growth properly;
▪the Company’s incorporation under the laws of Bermuda and the different rights to relief that may be available compared to other countries, including the United States;
▪the Company potentially becoming subject to corporate income tax in Bermuda in the future;
▪shareholders’ reliance on the Company to enforce the Company’s rights against contract counterparties;
▪dependence on the ability of the Company’s subsidiaries to distribute funds to satisfy financial obligations and make dividend payments;
▪the potential for shareholders to not be able to bring a suit against the Company or enforce a judgment obtained against the Company in the United States;
▪treatment of the Company as a “passive foreign investment company” by U.S. tax authorities;
▪being required to pay taxes on U.S. source income;
▪the Company’s operations being subject to economic substance requirements;
▪the exercise of a purchase option by the charterer of a vessel;
▪the outcome, timing and potential financial impact of ongoing or future litigation, arbitration proceedings or appeals, including litigation related to claims raised by public-interest organizations or activism with regard to failure to adapt or mitigate climate impact;
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▪increased cost of capital or limiting access to funding due to EU Taxonomy or relevant territorial taxonomy regulations;
▪the arrest or attachment of one or more of the Company’s vessels or rigs by maritime claimants;
▪damage to storage, receiving and other shipping inventories’ facilities;
▪impacts of supply chain disruptions and market volatility;
▪the implementation, expansion or escalation of trade restrictions, tariffs, port fees or retaliatory measures by the United States, China, the European Union or other jurisdictions, and the impact such measures may have on trade volumes, vessel utilization, operating costs and asset values;
▪potential requisition of the Company’s vessels or rigs by a government during a period of war or emergency;
▪global and regional economic, political and security developments, including armed conflicts, geopolitical tensions, sanctions, trade disputes, military actions, cyber warfare and related disruptions affecting global energy and shipping markets, including developments involving Russia and Ukraine, Israel, Iran and regional actors in the Middle East, and the security of major maritime trade routes;
▪disruptions to global trade routes, including actual or threatened attacks on commercial shipping, military conflicts, piracy, terrorism, sanctions enforcement actions, restricted transit through strategic waterways, vessel seizures, navigational hazards, rerouting requirements, increased war risk insurance premiums, or other security incidents affecting the Strait of Hormuz, Bab el-Mandeb, Red Sea, Suez Canal, Panama Canal or other major shipping routes, which could increase operating costs, reduce vessel utilization, increase fuel consumption, delay voyages, lengthen transit times and adversely affect charter market conditions; and
▪other important factors described under the heading “Risk Factors” in the Company’s Annual Report on Form 20-F for the year ended December 31, 2025, as well as those described from time to time in the reports filed by the Company with the SEC.
This report may contain assumptions, expectations, projections, intentions and beliefs about future events. These statements are intended as forward-looking statements. The Company may also from time to time make forward-looking statements in other documents and reports that are filed with or submitted to the SEC, in other information sent to the Company’s security holders, and in other written materials. The Company also cautions that assumptions, expectations, projections, intentions and beliefs about future events may and often do vary from actual results and the differences can be material. The Company undertakes no obligation to publicly update or revise any forward-looking statement contained in this report, whether as a result of new information, future events or otherwise, except as required by law.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| SFL CORPORATION LTD | |||||
Date: November 5, 2026
| By: | /s/ Aksel C. Olesen | |||||||
| Name: Aksel C. Olesen | ||||||||
| Principal Financial Officer | ||||||||
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