Great write up. Thanks for this. While revenue is expected to double, it may be important to evaluate outlook beyond 2025. Assuming the number of vessels is now set at 11 for the next few years, that rate limits how backlogs can be cleared over time. While backlogs may continue to increase, the rate of fulfillment could remain unchanged unless there is more vessel procurement, right? Additionally, for backlogs, any idea if day rate is already agreed upon or is this expected to fluctuate? A risk is lowering day rate as competition increases wherein smaller suppliers could undercut with a lower day rate. Is that a factor worth considering more?
Finally, given the high capex, would love to hear your thoughts on EBIDTA and profit margin multiple to EV. The current multiples seem rather high given high capex, but then I wouldn’t know what acceptable or low would look like. Thanks as always for the great analyses!
Thanks for your contribution! Regarding the number of vessels, Cadeler is currently operating with six (one of which just finished development and will soon begin its first job). Five of the eleven vessels are still under development — three are expected to be ready in 2025, one in 2026, and one in 2027.
This, combined with a potential increase in day rates due to the existing supply-demand imbalance, makes me believe Cadeler still has at least a few years of significant growth ahead. I don't think it's plausible to assume day rates will decrease, but to be honest, I'm not sure if they are fixed in advance. However, demand is expected to grow much faster than supply, so I don't see this as a short-term concern.
Regarding capex, that's one of the reasons I was hesitant to open a position (I still don’t own it). The construction of new vessels is highly capital-intensive, which is likely why the valuation multiples are so low. I’d like to get some clarification from management on the company's future capex trajectory, because in 2026, the number of vessels under development will decrease significantly, and capex should follow. If that happens, we might see a multiple expansion, but I’m still unsure, as they may decide to start building additional vessels in the meantime. On the other hand, as I explained in the article, the capital-intensive nature of vessel construction helps protect Cadeler’s leadership position in the short term. Additionally, since vessels take a long time to build, the supply-demand imbalance is likely to persist over the next few years.
Although the CEO is not the founder he played a pivotal in the development of the company… Please also take note of the fact that BW group (Solen-Pao) is the single largest shareholder with a participation of more than 20% and Mr. Solen-Pao is president of Cadeler. They entered during IPO in 2020 and last months increased their position on the open market. To me this is almost equally convincing.
Great write up. Thanks for this. While revenue is expected to double, it may be important to evaluate outlook beyond 2025. Assuming the number of vessels is now set at 11 for the next few years, that rate limits how backlogs can be cleared over time. While backlogs may continue to increase, the rate of fulfillment could remain unchanged unless there is more vessel procurement, right? Additionally, for backlogs, any idea if day rate is already agreed upon or is this expected to fluctuate? A risk is lowering day rate as competition increases wherein smaller suppliers could undercut with a lower day rate. Is that a factor worth considering more?
Finally, given the high capex, would love to hear your thoughts on EBIDTA and profit margin multiple to EV. The current multiples seem rather high given high capex, but then I wouldn’t know what acceptable or low would look like. Thanks as always for the great analyses!
Thanks for your contribution! Regarding the number of vessels, Cadeler is currently operating with six (one of which just finished development and will soon begin its first job). Five of the eleven vessels are still under development — three are expected to be ready in 2025, one in 2026, and one in 2027.
This, combined with a potential increase in day rates due to the existing supply-demand imbalance, makes me believe Cadeler still has at least a few years of significant growth ahead. I don't think it's plausible to assume day rates will decrease, but to be honest, I'm not sure if they are fixed in advance. However, demand is expected to grow much faster than supply, so I don't see this as a short-term concern.
Regarding capex, that's one of the reasons I was hesitant to open a position (I still don’t own it). The construction of new vessels is highly capital-intensive, which is likely why the valuation multiples are so low. I’d like to get some clarification from management on the company's future capex trajectory, because in 2026, the number of vessels under development will decrease significantly, and capex should follow. If that happens, we might see a multiple expansion, but I’m still unsure, as they may decide to start building additional vessels in the meantime. On the other hand, as I explained in the article, the capital-intensive nature of vessel construction helps protect Cadeler’s leadership position in the short term. Additionally, since vessels take a long time to build, the supply-demand imbalance is likely to persist over the next few years.
Thanks for your response. Appreciate the great work!
Although the CEO is not the founder he played a pivotal in the development of the company… Please also take note of the fact that BW group (Solen-Pao) is the single largest shareholder with a participation of more than 20% and Mr. Solen-Pao is president of Cadeler. They entered during IPO in 2020 and last months increased their position on the open market. To me this is almost equally convincing.
Thanks for sharing Vogez, that definitely makes sense! :)