Annual Report Boa Offshore AS Group Org.nr

Transcription

1 Annual Report Group 2014 Org.nr

2 BOA OFFSHORE AS GROUP BOARD S ANNUAL REPORT FOR 2014 Nature and location of activities: is the management company of the Taubåtkompaniet Group and the parent company of the Boa Offshore Group ( Group ). The company also invests in the shipping and offshore related companies. The Group comprises several ship owning companies within the following segments; tugboat, barge and offshore vessels. The tugboat activity, including salvaging, operates along the Norwegian coast and the North Sea. The barge fleet consists of larger barges, and the offshore department manages supply vessels within construction and oil exploration, operating worldwide. The management is located in Trondheim. An office in Houston has been established, currently engaged in the Gulf of Mexico operating chartered construction vessels in addition to the Group s vessels. Work environment: At year-end the Group had approx. 395 employees and, in the opinion of the Board, a good work environment. The total absenteeism rate for the year was around 3.3 %. Equal opportunity: The Group operates within a sector that has historically been dominated by men. This is also the case among our staff, in which men form the majority of the maritime crew. The company aims to ensure that any discrimination based on gender, religion or nationality is subject to immediate followup by the managing staff onboard the vessels and onshore ensuring conditions guarantees equal opportunity. The gender ratio in administration onshore is approx. 37 % women and 63 % men. For the company in total the ratio of women is approx. 12%. There are two top positions in the Group management held by a woman. For the Group, the distribution among the employees is about 13 % women and about 87 % men. Health, safety, the environment and quality: The goal of the Group s health, safety, the environment and quality policy is zero tolerance when it comes to injury to persons, damage to ships, work-related illness and environmental damage. Company aims to achieve this goal by establishing a good work environment and work routines both onboard the vessels and onshore. The risk factors linked to the company s operations are continuously identified and the necessary risk-reducing measures implemented. The Group has established procedures for dealing with accidents and other emergency situations and meets international requirements concerning safeguards against acts of terrorism. The Group aims to be known in the market for providing high-quality services and in accordance with national and international laws and regulations. To achieve these goals, the Group has established an integrated health, safety, environment and quality control system that is used by both the onshore organisations and crew on board the vessels. The system meets all relevant requirements with regard to international standards as well as requirements and guidelines developed by branch organisations within the offshore and shipping sectors. The system undergoes continuous improvements based on reports from users and annual reviews by customers, authorities and the organisation itself. The goal for the future with regard to the integrated health, safety, the environment and quality system is to achieve combined certification pursuant to the requirements of the ISM code and ISO 9001:2000 quality standard. Over the last year it has been one serious work-related injury among employees and contracted personnel. The Group is continuously working to reduce the number of work related injuries.

3 External environment: The machinery on the vessels run on fuel and, apart from the emissions from this machinery, the Board does not believe that the ships pollute the external environment beyond what is normal for this type of maritime activity. The Group is continuously working to reduce any discharge to sea and air. Continued operations: (parent company) has positive equity as per December 31, The company's shareholdings in subsidiaries, in the board's opinion, have significant higher value relative to the book values. The annual accounts for 2014 for the Group were drawn up under the assumption of continued operations. Review of annual accounts: The operating profit for the Group in 2014 was MNOK compared to MNOK in Net financial items were MNOK compared to MNOK in The company has both in 2013 and 2014 had major non-recurring costs related to refinancing and raising new loans The Group has in 2014 had a tax income of MNOK 21.7, compared to MNOK 2.7 in the tax expense in The final result was a profit of MNOK 32.5 compared to MNOK 68.7 in Total year end assets were MNOK compared to MNOK the previous year. The percentage of shareholder s equity on December 31, 2014 was 28.3 % compared with 29.9 % on December 31, Boa PSV AS has two newbuilding contracts with Nantong Mingde Heavy Industries in China. The yard has over a period of time, had financial problems and there has not been any progress in the building process. At the end of 2014 the yard started debt settlement negotiations with their creditors. The yard has confirmed that despite the debt settlement negotiations, they will complete the building process for the vessels. Boa PSV has started a legal process to look into the company s rights to cancel the contracts according to the British regulations they are subjected to. Boa PSV AS has received bank guarantees from the yard for paid-in capital on the projects and this guarantee is considered to cover all paid-in capital to the yard. In addition, Boa Shipping AS has previous years completed payments to the shipyard on other projects. It is believed that these payments are intact and it is therefore not necessary for further impairment of newbuilding projects. Financial risk: Market risk: The Group is susceptible to changes in currency rates considering that the Group's earnings and long-term financing is partly in foreign currency. However, the currency risk is reduced somewhat since the operating costs of the Group are in the same currency. The Group continually considers entering into forward contracts and other agreements in order to reduce the currency risk. By the total of the group s interest bearing debt was NOK million where of NOK million is secured by interest rate swap agreements or fixed rate. Credit risk: The risk that the other contracting party will not have the financial means to meet its obligations is considered low. Agreements have not been made for set-offs or other financial tools to minimise the Group s credit risk. Liquidity risk: The group s liquidity position as of is NOK 634 million. The initiated new-building program is fully financed with both short-term construction loans and long-term financing. The parent company has 2 bonds of a total of NOK 559 million listed at Oslo Stock Exchange ABN, as well as a non listed bond of NOK 50 million outstanding. The bonds have maturity dates in 2015 (NOK 59 million) and 2018 (NOK 500 million) and 2020 (NOK 50 million). The total of outstanding bonds as of was NOK million.

4 Appropriation of profits: The year-end result of the parent company,, was MNOK 864,8. The Board proposes the following distribution: Transferred to other equity MNOK 855,7 Group contribution MNOK 9,1 Events after the balance sheet date: No events have taken place after the end of the financial year that would materially affect the evaluation of the Group's profit and loss account or balance sheet as per December 31, Future Development: The short to medium term outlook for some of the segments Boa Offshore operates within remains uncertain, despite a 30% recovery of the Brent oil price from the January 2015 low to the current USD60/bbl. A number of offshore projects are now being postponed as oil companies focus more on cash flow on the back of lower oil prices. On the other hand the cost level of the oil and gas industry has adjusted and decreased as a result, and oil prices probably need to recover to the USD70-80/bbl range to spur demand growth again in general. Sanctioned projects and projects under development will provide a certain sustained activity level in the short to medium term. A number of the segments Boa Offshore operates within are exposed to other sectors and industries than oil and gas. Both the barge and tug businesses of Boa are exposed to other industries and demand drivers than oil and gas. For both these segments we see good possibilities for the next couple of years. A large part of the work performed by Boa OCV and BMSI is within the IMR part of the subsea sector, which is less cyclical than the installation segment. BMSI and the AHTS segment represent the spot exposed income in the Boa Group. Activity in the US GoM, where BMSI operates, is relatively healthy. However, increased competition from more vessels mobilized to the region represents some risk in the short to medium term. In the AHTS segment the level of the North Sea AHTS spot fleet will determine the strength of the market, as demand from working rigs and FPSO installations are seen stable to slightly up Y/Y in The long-term outlook for the offshore sector is still considered to be prospective as global demand for oil and gas continue to grow, and offshore will play an important role in developing new reserves and increase production. The Group's strategy remains to focus on a modern fleet of large offshore vessels adapting to new demands from customers and the increased long-term activity in offshore developments. The Group seeks to balance the contract portfolio between spot and long-term contracts.

5 Parent company Income statement Figures in NOK Group Operating income and operating expenses Note Total operating income Operating cost ships Payroll expenses 3, 9, Depreciation Write down fixed assets Other operating expenses 3, Total operating expenses Operating result Financial income and expenses Income from subsidiaries Interest income from group companies Other interest income Other financial income Depreciation of other financial fixed assets Interest expense to group companies Other interest expenses Other financial expenses Financial result Result before tax Tax on ordinary result Profit for the year Minority share Dividend To other equity Net brought forward

6 Parent company Balance sheet Figures in NOK Group Fixed assets Intangible assets Note Deferred tax asset Total intangible assets Tangible fixed assets Buildings and land Vessels Equipment and other movables Newbuilding contracts Total tangible fixed assets Financial fixed assets Investments in subsidiaries Loans to group companies 6, Investments in shares Other receivables 6, Total financial fixed assets Total fixed assets Current assets Inventories Receivables Trade receivables Loans to group companies Other receivables Total receivables Investments 0 0 Other financial instruments Total investments Cash and bank deposits Total current assets Total assets

7 Parent company Balance sheet Figures in NOK Group Equity and liabilities Restricted equity Note Share capital 7, Share premium Other restricted equity Total restricted equity Retained earnings Other equity Total retained earnings Total equity Minority share Liabilities Provisions Other provisions Total provisions Other long term liabilities Bonds 10, Liabilities to financial institutions 10, Liabilities to subsidiaries Other long term liabilities 10, Total other long term liabilities Current liabilities 0 0 Liabilities to financial institutions Trade creditors Liabilities to subsidiaries Tax payable Public duties payable Dividends Other short term liabilities Total short term liabilities Total liabilities Total liabilities and equity

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9 Consolidated Cash Flow Statement Figures in NOK YTD 2014 YTD 2013 YTD 2014 YTD 2013 Cash flow from operating activities Profit before income taxes Income tax payable Depreciation and write-down Gain on sale of tangible fixed assets Write-down of financial fixed assets Currency gain/-loss Changes in inventories Changes in trade receivables Changes in other receivables Changes in trade creditors Changes in receivables from group companies Changes in other short-term liabilities Net cash flow from operating activities A Cash flow from investing activities Sale of tangible fixed assets Purchase of tangible fixed assets Changes in other investments Net cash flow from investing activities B Cash flow from financing activities Raised long term liabilities Paid in long term liabilities Changes in liabilities Group contribution Paid in share capital Net cash flow from financing activities C Net changes in cash and cash equivalents A+B+C Cash and cash equivalent start at period Cash and cash equivalents at end of period

10 Note 1 Accounting principles The annual accounts are established in accordance with the Norwegian Accounting Act of 1998 and generally accepted accounting principles. Consolidation principles The consolidated financial statement comprises and subsidiaries, where the company has controlling interest as a result of legal or actual control. The consolidated accounts are established in accordance with uniform accounting principles for similar transactions within all companies included in the consolidated financial statement. All essential transactions and outstanding accounts between companies within the group are eliminated. Investments in companies in which the group has considerable influence (associates and joint ventures) are valued in the consolidated financial statement in accordance with the equity method. Considerable influence generally means that the group owns 20 to 50 percent of the voting capital. Principle rule for recording and categorising assets and debts Assets intended for long-term ownership or usage are categorised as fixed assets. Other assets are categorised as current assets. Debts to be paid back within a year are also categorised as current assets. Similar criteria are used to categorise short-term and long-term debts. Fixed assets are valued at purchase cost, and depreciated over the economic lifetime. If the actual value of the fixed assets is lower than the booked value and the decrease in value is not expected to be temporary, devaluation to the actual value is carried out. Fixed assets are depreciated linearly. Current assets are recorded at the lowest of historical cost and net realisable value. Other long-term and short-term debts are recognised at nominal value. Assets and debt in foreign currency Money items in foreign currency are converted at the rate applicable on the balance sheet date. Capitalised interests Interest related to ships under construction are capitalized. Shares in associates, joint ventures and subsidiaries Investments in subsidiaries are valued according to the cost method and written down at the actual value if the decrease in value is not temporary, and it is considered necessary in accordance with generally accepted accounting principles. Dividend from subsidiaries are recorded as other financial income. The same applies to investments in associates and joint ventures. Other shares classified as fixed assets Shares and investments in general partnerships and limited partnerships in which the company does not have considerable influence are valued according to the cost method. Investments are written down at the actual value if the decrease in value is not expected to be temporary. Profits received from the companies are recognised as other financial income. Bonds classified as fixed assets Bonds are recognised at purchase cost. Bonds are written down at the actual value if the decrease in value is not expected to be temporary. Investments classified as floating assets Market-based financial instruments, including shares included in a trading portfolio, are recognised at the actual value on the balance sheet date.

11 Receivables Accounts receivable and other receivables are entered at nominal value after deducting the provision for expected losses. The provision for losses is based on an individual assessment of the separate claims. Bank deposits, cash, etc. This category includes cash, bank deposits and other forms of payment with an expiration date that is shorter than three months from purchase. Revenue Revenues from the sale of services are recognised in the income statement according to the project's level of completion. Revenues are booked at the net sales value at the time of the transaction. Expenses Expenses are recognised in the same period as the related revenues. In those instances in which there is no clear connection between expenses and revenues, the distribution is determined based on discretionary criteria. Other exceptions from the classification principle are disclosed when relevant. Pensions Contribution pension plan The company has a contribution-based obligatory company pension scheme for onshore personnel. This is expensed at date of payment. Performance-based scheme The company also has a performance-based company pension scheme for maritime personnel. The liability is valued annually and the balance is classified as long-term provisions (receivables) in the balance sheet. Government subsidies The group receives a subsidy from the Norwegian Maritime Directorate in connection with the employment of Norwegian maritime personnel. The subsidy is entered as a reduction under the group's salary costs. Taxes Tax expenses are grouped with operating profit before tax. Taxes are recognised directly in equity to the extent that they relate to equity transactions. The Ship Owning companies is taxed by the Norwegian shipowning tax regime as of Tax cost includes taxes payable (tax on this years taxable income and interest surplus), tonnage tax and change in net deferred taxes. Deferred tax and deferred tax benefits are entered in net amounts on the balance sheet. Miscellaneous All figures in the notes are quoted in NOK

12 Note 2 Segments OCV vessels Seismic vessels Barges Other / elimination Operating income EBITDA EBIT (11 128) Total Note 3 Personnel compensation, number of employees and loans to employees etc. Parent company Group Salaries Employer's national incurance contribution Pension contribution Other personnel expenses Hired in staff Total personnel costs Number of man-labour years employed Management remuneration Salary Pension cost Other CEO Board of Directors parent company 150 group 150 Loan and securities to shareholders, management personnel and employees Amount Interest rate Securities Employees % Security in fixed assets Related parties % Pledged shares Auditor Parent company Group Audit fee for 2014 to Deloitte AS was NOK Fee for audit related services was NOK Fee paid to Deloitte Advokatfirma AS was NOK

13 Note 4 Fixed assets Parent company Vessels Periodic maintenance Property Property, Vehicles Acquisition cost on Corr. due to change of princ Additions Disposals Acquisition cost on Accumulated depreciation Acc. depreciation disposals Acc. Write-down disposals Depreciation this year Accum. depreciation Sum Book value Economic life 16 years 2,5-5 years 5 years Depreciation schedule Linear Linear Linear Annual lease amount on fixed assets not included on the balance sheet 449 Group Vessels Periodic maintenance Ships under construction Buildings, land and equipment Acquisition cost on Corr. due to change of princ Additions Completed vessels Disposals Acquisition cost on Accumulated depreciation Corr. due to change of princ Acc. depreciation disposals Depreciation this year Write-down this year Accum. depreciation Sum Book value Economic life years 2,5-10 years 5 years Depreciation schedule Linear Linear Linear Annual lease amount on fixed assets not included on the balance sheet The group companies were making allocations for class costs. The allocations was made based on estimated time for next periodic class survey. From the cost of periodic maintenance of vessels is capitalized and depreciated to the next periodic maintenance.

14 Note 5 Shareholdings in subsidiaries, associated companies and joint ventures Group Year of aquisition Office address Share Equity Dec Results 2014 Subsidiaries (Norwegian) Boa Shipping AS 2000 Trondheim 100 % Boa OCV AS 2002 Trondheim 100 % Boa SBL AS 2008 Trondheim 100 % T.A. Kittilsen Shipping AS 1998 Brevik 100 % Nye Kystlink AS 2012 Trondheim 100 % Det Nordenfjeldske Dampskibsselskab A 2012 Trondheim 77 % Tier subsidiaries (Norwegian) Boa Barges AS 2008 Trondheim 100 % Boa PSV AS 2011 Trondheim 100 % Boa IMR AS 2014 Trondheim 100 % 41 2 Boa Tugs AS 2008 Trondheim 100 % NFDS Offshore 1 AS 2012 Trondheim 77 % NFDS Offshore 2 AS 2014 Trondheim 78 % Subsidiaries (foreign) Boa Marine S.A 2006 Gdynia i Polen 100 % 6 97 Rederi AB 2005 Sverige 100 % Boa Tugs AB 2011 Sverige 100 % Boa Offshore LLC 2011 USA 100 % Tier subsidiaries (foreign) Boa Marine Services Inc USA 100 % Fixed assets Parent company Company Share Acq. costs Book value Market value Midnor Bestik (foundation) 0,50 % EMGS ASA Nio Inc Åfjord Utvikling AS 3 % Sum Group Company Share Acq. costs Book value Market value Midnor Bestik (foundation) 0,50 % EMGS ASA Nio Inc Åfjord Utvikling AS 3 % Taklift AS 10 % Sum

15 Note 6 Long-term receivables Parent company Group Receivables from group companies Other long-term receivables Sum Note 7 Shareholder information Shares Equity share Voting share Taubåtkompaniet AS ,00 % 100,00 % Total number of shares ,00 % 100,00 % The company's share capital is NOK , distributed among shares of par value NOK The company has only one class of shares. The company and its subsidiaries is a part of the group Taubåtkompaniet AS. The groups financial statement can be distributed from the office in Trondheim. Note 8 Parent company Shareholder's equity Share capital premium equity Other equity SUM Equity Profit of the year Corr. due to change of princ Additional dividend Dividend Equity Share Other restricted Group Other Share restricted Share capital premium equity Other equity SUM Equity Paid in capital Profit of the year Dividends Additional dividend Corr. due to change of princ Conversion differences Equity

16 Note 9 Pension costs and net pension liabilities The company is obliged to have a company pension scheme in accordance with the Norwegian Pension Act. for all employees. The company has performance-based pension schemes for a total of 95 persons. These schemes entitle the employee to certain future payments. This primarily depends on the number of years of employment, the salary level upon reaching retirement age and the size of the contribution from the National Insurance. These obligations are covered through an insurance company. Pension cost Net present value of pension build-up this year Interest costs for pension obligation Return on pension funds Estimated deviation recorded Administrative costs Accrued employer's contribution Net costs after employer's contribution Pension obligation Pension obligation Pension funds (at market value) Accrued employer's contribution Deferred obligation for (losses)/profits Net pension funds Financial assumptions Interest rate 2,3 % 4,0 % Expected return 3,2 % 4,4 % Salary increase 2,8 % 3,8 % G-regulation 2,5 % 3,5 % Regulation of continuous pension 0,0 % 0,6 % Employer's contribution rate 14,1 % 14,1 % Voluntary resignation before the age of 40 0 % 0 % Voluntary resignation after the age of 40 0 % 0 % Actuary predictions for demographic factors and resignations are based on commonly used assumptions within the insurance industry. Note 10 Long-term debts Parent company Instalments of debt falling due more than 5 years from the balance date: Instalments Group Instalments of debt falling due more than 5 years from the balance date: Instalments A MNOK 212 loan in Boa PSV AS is both a combined construction- and Long term loan, and as such not included in the above table.

17 Note 11 Outstanding accounts with companies within the same group Parent company Long term liabilities Short term liabilities Taubåtkompaniet AS Boa OCV AS Boa SBL AS Boa Shipping AS 900 Boa Eiendom AS 60 Boa Barges AS T.A.Kittilsen Shipping AS 157 Boa Marine Services SA Boa Marine Services Inc Boa Offshore LLC NFDS Offshore 1 AS 4003,17 Boa Tugs AB Rederi AB Sum Long term receivables Short term receivables Taubåtkompaniet AS Boa OCV AS Boa SBL AS Boa Shipping AS Boa Eiendom AS Boa Barges AS Boa Tugs AS Boa Tugs AB 281 Boa PSV AS T. A. Kittilsen Shipping AS Boa Marine Services Inc Boa Offshore LLC Nye Kystlink AS NFDS AS 64 7 NFDS Offshore 1 AS NFDS Offshore 2 AS 168 Boa Investment AS Sum Group Long term liabilities Short term liabilities Taubåtkompaniet AS Boa Eiendom AS Boa Investment AS Sum Group Long term debt Short term debt Boa Eiendom AS 60 Taubåtkompaniet AS Sum

18 Note 12 Tax Parent company This years tax: Changes in deferred tax Tax payable US 2 96 Tax previous years This years tax expense This years tax basis: Result before tax Permanent differences Changes in timing differences Group contribution This years tax basis Tax payable in balance: Tax paid in US SkatteFUNN tax deduction Tax payable in balance Temporary differences: Tangible fixed assets Profit and loss account Provisions Short term liabilities Tax losses carried forward Net temporary differences Net deferred tax

19 Group: This years tax: Changes in deferred tax Tax payable Norway Tonnage tax Tax previous years Tax payable US This years tax expense This years tax basis, ordinary taxation: Result before tax Permanent differences Changes in timing differences This years tax basis Calculation of tax base for the year shipping taxation: Profit and loss account Financial result Loss carried forward used Tax base for the year Tax payable in balance: Calculated tonnage tax Taxes payable Tax payable in balance Temporary differences: Tangible fixed assets Receivables Profit and loss account Provisions Short term liabilities Tax losses carried forward Net temporary differences Net deferred tax The shipowning companies in the group are taxed in accordance with the Norwegian shipowning tax regime.

20 Note 13 Pledges and guarantees, etc. Parent company: Book debt secured by pledge: Debts to credit institutions Accrued interest Total Book value of pledged assets: Cash deposits Vessels Money Claim Total Book value of assets mortgaged for debt for group companies: Shares Vessels Total Guarantee liabilities is the guarantor for the fulfillment of loan obligations in Boa Barges AS, Boa PSV AS, Boa Tugs AS, NFDS Offshore 1 AS and NFDS Offshore 2 AS. Group: Book debt secured by pledge: Debts to credit institutions Accrued interest Total Book value of pledged assets: Cash deposits Accounts receivables Vessels Shares/bonds Group receivables Other Total Guarantee liabilities Note 14 Bank deposits Parent company Group Restricted deposits Employees' tax deduction Other restricted deposits Total Note 15 Other appropriations for liabilities The group companies were making allocations for class costs. The allocations was made based on estimated time for next periodic class survey. From the cost of periodic maintenance of vessels is capitalized and depreciated to the next periodic maintenance. See further note 4.

21 Note 16 Intercompany transactions The owner of the company is Taubåtkompaniet AS, with 100 % of the shares. Ole T Bjørnevik is controlling Boa Holding AS. Management remunerations are mentioned in note 3, and the outstanding accounts with group companies are mentioned in note 9. Mortages and guarantees are mentioned in note 11. Operating transactions: Income - Mother company Subsidiary Other group companies Total revenue from operating transactions Services - Subsidiary Other group companies Total expenses from operating transactions Investing transactions: Shareholder contribution - Other group companies Property purchase - Other group companies Sale of shares / transfer of receivable - Other group companies Total investing transactions Finance transactions: Group contribution and dividend - Subsidiary Interest income - Mother company Subsidiary Other group companies Income from guarantee commission - Subsidiary Total income from finance transactions Interest expense - Subsidiary Other group company Guarantee commission - Mother company Total expenses from finance transactions Dividend - Mother company Total dividend Service to group companies are priced at the same conditions as for external parts. Services to group companies are management and crew hire. These services are priced at cost + 2,5% to 10%. Financial transactions are priced at the same conditions as for external parts.

22 Group: Operating transactions: Income - Mother company Other group companies Total revenue from operating transactions Services - Other group companies Total expenses from operating transactions Investing transactions: Property purchase - Other group companies Total investing transactions Finance transactions: Interest income - Mother company Other group companies Total income from finance transactions Interest expense - Mother company - Other group companies Guaratee commission - Mother company Total expenses from finance transactions Dividend - Mother company Total dividend Service to group companies are priced at the same conditions as for external parts. Services to group companies are management and crew hire. These services are priced at cost + 2,5% to 10%. Financial transactions are priced at the same conditions as for external parts.

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