quarterly report march 2008 Premuda

Transcription

1 quarterly report march 2008

2 Group s structure at 31 March 2008 Spa International Sah Luxembourg m/t. Four Island m/t. Four Bay m/t. Framura m/t. Four Springs m/t. Four Moon m/v. Four Etoiles m/v. Four Coal m/t. Four Sun * m/t. Four Smile * m/t. Four Schooner * m/v. Doric Spirit * Four Vanguard Serviços e Navegaçao Lda. FPSO Four Vanguard Moon Shipping Serviços e Navegaçao Lda. m/t. Four Atlantica ** m/t. Four Antarctica ** Jep Navegaçao Lda. (Atlantic) Inc. Houston USA Australian FPSO Management Pty. Ltd. Perth Australia Suezmax Navegaçao Lda. m/v. Four Earth Brig Shipping Lda. Bulk dwt () Bulk dwt () Bulk dwt () Bulk dwt () Bulk dwt () Bulk dwt (2011) Bulk dwt (2011) Bulk dwt (2011) Bulk dwt (2011) Bulk dwt (2012) 90% (Monaco) Sam Monaco Cordier Navegaçao Lda. Bulk dwt () Bulk dwt () 43% (#) Chartering Navegaçao Lda. Aframax dwt () Aframax dwt () Aframax dwt () Bulk Navegaçao Lda. Panamax Navegaçao Lda. Holding Company ShipManagement Company Commercial Company ShipOwning Company Non Operative Company * : long term timecharter in ** : long term bareboat out (#) : 33% within vessels delivery

3 The Group's Fleet at 31 March 2008 name type hull design year built dwt tankers Four Antarctica * Four Atlantica * Four Island Four Bay Framura Four Springs Four Moon aframax Ice Class aframax Ice Class aframax tanker aframax tanker aframax tanker aframax tanker panamax tanker / , ,900 65,100 total owned tanker 670,800 FPSO 8 Four Vanguard FPSO 1992/2003 total owned FPSO bulk carriers Four Coal Four Earth Four Etoiles panamax bulk panamax bulk panamax bulk ,400 78,000 54,500 total owned bulk 206,900 total owned Fleet 971,700 new buildings (33%) (33%) (33%) aframax product aframax product aframax product , , ,700 34,000 34,000 34,000 34,000 total under costruction 760,100 chartered in Four Sun ** Four Smile ** Four Schooner ** Doric Spirit ** Four Shinano ** Four Kitakami ** Four Mogami ** suezmax tanker suezmax tanker panamax tanker handymax bulk handymax bulk handymax bulk handymax bulk , ,000 73,100 52,500 56,300 56,000 56,000 total tonnage chartered in 613,900 total at ,345,700 * : renamed Stena Antarctica e Stena Atlantica (long term bareboat) **: long term timecharter in

4 consolidated balance sheet ( /000) at at at ASSETS vessels new vessels under construction 362,219 (267,058) (67,302) 338,879 (285,701) (45,092) 347,565 (273,105) (46,863) CURRENT ASSETS, DEFERRED CHARGES 47,498 71,993 70,646 Total Assets 409, , ,211 SHAREHOLDERS' EQUITY third party interest 203,349 (65) 196,170 (8,162) 207,508 (70) LONG TERM LIABILITIES 144, , ,223 CURRENT LIABILITIES 62,325 58,292 60,480 Total Equity and Liabilities 409, , ,211 consolidated profit and loss account ( /000) Jan/Mar 2008 Jan/Mar 2007 Jan/Dec 2007 Net revenues Voyage costs 33,218 (1,449) 34,101 (2,320) 133,050 (10,298) Time charter revenues 31,769 31, ,752 Charter hire and other operating costs (17,613) (15,326) (61,861) Fleet margin 14,156 16,455 60,891 Profit on vessel sale General expenses and other cost/income Depreciation (3,499) (6,124) 8,307 (4,024) (5,983) 28,583 (19,729) (23,809) Operating result 4,533 14,755 45,936 Financial items Profit/loss on subsidiaries (2,659) (3) (2,002) 278 (9,886) (291) Pretax income 1,871 13,031 35,759 Tax on income (294) (183) (528) Net profit 1,577 12,848 35,231 Third parties interests (5) 2,053 2,113 Group's net profit 1,582 10,795 33,118

5 Summary of significant accounting policies This Financial Statement, like the previous year Annual Accounts, has been prepared according to the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB). The quarterly data, expressed in thousands of Euro, are compared with the corresponding period of previous year, and with the entire previous year. Participations in associated companies and other participations not included in the consolidation area are recognized on the basis of available information, highly reliable. There are no estimates and/or valuations excluding the ordinary ones. The consolidation area and the relative criteria remain unchanged, compared to the Annual Accounts of 31st December Euro/Dollar exchange rate The attached table shows the Euro/Dollar exchange rate on various periods average average yearly 1st quarter at st quarter at average at The average data show a 12.5% decrease of Dollar compared to the corresponding period 2007 and a 8.5% decrease compared to the entire year. The end of period data show a 15.75% decrease in the last twelve months, of which 6.9% in the first quarter A weak Dollar is undoubtedly a negative element for companies operating in our industry, both from a Balance Sheet and a Profit and Loss standpoint. In fact, vessels value and freight rates are almost exclusively quoted in dollars, while generally only a part of the relevant costs are denominated in such currency. It is so important to emphasize that with particular reference to the loans denominated in Dollars both the Consolidated Balance Sheet and the Profit and Loss Account can be significantly affected by the movement of the Euro/Dollar exchange rates and special care is then required when making comparisons. As an example, we remark that should the average and the end of period exchange rate be the same of the corresponding period of last year, the Net Profit of the first quarter 2008 would be increased of /mil 4.1 and the Net Equity at 31 March 2008 would be decreased of /mil 4.8, all other factors unchanged. Financial Position The following table summarizes the net financial position, in thousands of Euros: at at at Cash and liquid assets short term bank debt short term portion of medium/long term bank debt other short term finacial debt Total short term financial debt 21,635 (27,609) (27,609) 36,810 (23,301) (23,301) 43,755 (28,088) (28,088) Total net short term financial debt (5,974) 13,509 15,667 Long term financial credit 26,046 25,799 medium/long term bank debt other long term debt Total long term financial debt (142,958) (142,958) (142,958) (10,906) (153,864) (148,670) (148,670) Total net long term financial debt (116,496) (153,864) (122,871) Total net financial debt (122,470) (140,355) (107,204) The net financial exposure on March 31st 2008 is decreased of /mil 17.9 in comparison with March 31st 2007 mainly because of the divestments realized in the second part of previous year, whilst it's increased of /mil 15.3 when compared with December 31st 2007 because of the new investment started meanwhile. Financial Results The consolidated result for the first quarter 2008 has recorded a profit of 1.6 million compared with a corresponding value of 12.8 million for the first quarter 2007 ( 10.8 million net of minority interest). We point out that the result of first quarter 2007 included /mil 8.3 as profit on sale of vessel, /mil 2.1 of which pertaining to minority shareholders. The profit for the entire 2007, net of minorities, was 33.1 million, inclusive of 28.6 million as profit on sale of vessels. The consolidated cash flow of the period amounted to 7.7 million ( 18.8 million in the corresponding period of 2007). The consolidated equity at 31 March 2008, net of minority interest and net of dividends to be paid by S.p.A. for 2007, amounted to million (a 8.2% increase over March 2007). The net equity per each of shares is equal to Euro, net of third parties interest. The commercial and operating activity of the fleet was regular, within a freight market environment highly volatile but always positioned at satisfactory level, as later on reported. Considering that our revenues are almost entirely expressed in Dollar, we point out that the fleet margin was penalized by the Euro/Dollar exchange rate, on average 12.5% lower than the corresponding period of During the first quarter 2008 we have been notified a decree granting /mil 3.9 as subsidy for the scrapping (realized in year 2003) of the single hull tanker vessel Four Astra. The result of first quarter 2008 includes this subsidy, that is expected to be cashed very shortly.

6 Fleet The attached table shows the Group's fleet, as of 31st March The only change in the first quarter 2008 is referred to the fleet on order, increased by two units after the acquisition of the company Cordier Navegaçao Lda, owner of the contracts for two 34,000 dwt carriers to be built by Vinashin shipyard, for expected delivery. As already anticipated in the Annual Report 2007, the transaction produces a total investment of about /mil 48 (of which about 20 already paid). Regarding the Fleet utilization in the first quarter, the available operating time has been allocated as follows: 1 st Quarter st Quarter 2007 tankers bulk tankers bulk commercial operations maintenance operations awaiting for cargoes 95,5 % 4,2 % 0,3 % 100,0 % % % 95,4 % 2,8 % 1,8 % 100,0 % % % The data regarding commercial operations are in line with first quarter Anyway, we have to report that the FPSO Four Vanguard registered a significant hire deduction in the first quarter 2008 caused by disconnection and late reconnection due to cyclones crossing the production area. Such events produced a total cost of about /mil 3.8, entirely charged to Profit and Loss. The unit also registered a long stop of production due to leakages and subsequent repairs on some valves. The event has not affected the result of first quarter 2008 because the analysis effected by independent experts (appointed by us) indicate this to be caused by the presence, in the oil, of raw materials and other products out of contractual specifications: should this be confirmed, the charterer will have to bear all time and costs of repairs, for about /mil 5.7. In order to collect such amounts, we could be forced to ask for an Arbitration. Market and prospects The following table shows the average spot charter rates recorded in the markets we operate in, with values expressed in dollars/day, time charter equivalent: st 1 Qrt. nd 2 Qrt. rd 3 Qrt. th 4 Qrt. average st 1 Qrt. suezmax aframax panamax tankers panamax bulk The data shows that, in comparison with first quarter 2007, the tanker market registered a 7.2% increase for suezmax, a 6.4% decrease for aframax and a 14.1% decrease for panamax. For any vessel size the rates are, anyhow, higher than the averages of entire year In the dry bulk market, freight rates were significantly increased in comparison with both the first quarter and the entire year 2007, but reduced when compared to the historical highs of last quarter The second quarter 2008 started with freight rates higher than the first quarter, both for tankers and bulk carriers. As already evidenced in the past, it's very difficult to anticipate the future of such a volatile market, heavily influenced by many economical and political factors. However, considering the commercial coverage of the fleet already fixed and the perspective for the freight market, it's reasonable to envisage for our Group (apart from any additional unpredictable event) a positive result for the entire 2008, notwithstanding the highly negative impact of the Euro/Dollar exchange rate. In addition, it's not reasonable to consider in advance that the profitable sale of vessels realized in the past could be repeated in the future. Due to the expected contribution from the vessels presently on order, our expectations for next years are confirmed as very positive. Significant updates following quarter closure After the end of March, we notice: the controlled company Four Handy Limited was set up. The company will operate, under the U.K. Tonnage tax regime, the new carriers presently on order;. the agreement to sell (after exercising our purchase option) the Four Schooner, at the end of present employment (May/June ). The transaction will generate a profit of about 8.5 million dollar (that will be recognized on balance sheet). Genoa, 14th May 2008 The Board of Directors

7 Glossary Aframax 80120,000 dwt tanker. B/B Bare Boat Charter Contract with which the ship is placed at the disposal of the Charterer, without a crew, for a specific period of time. In addition to voyage costs (fuel, port expenses, canal transit fees, etc.), the charterer must also bear all the operating costs (crew, maintenance, repairs, lubricants, supplies, insurance). By its nature, the Bare Boat normally covers lengthy periods of time. Double Bottom Ship built with a double hull limited to the bottom; the height of the double bottom is 23 metres and the relative volume is normally used to contain clean ballast water. Double Hull Ship built with a complete double hull to reduce the risk of spills in case of grounding or collisions; the distance between the two hulls is generally is 22.5 metres and the relative space is used for clean ballast. DWT DeadWeight Tonnage Ship transport capacity, measured in tons (dwt), including cargo, fuel, supplies and crew. FPSO Floating Production Storage and Offloading unit A ship positioned on an offshore oil field, equipped for production, with initial processing, storage and shifting to other crude oil units. ICE Class A1/A1 Classification issued by Classification Registers for ships designed to navigate under their own power in water with ice. Multipurpose Bulk Carrier A very versatile ship, suitable for transporting dry bulk, steel products, including pipes, large products and containers. Offhire Period in which the ship does not generate charter income, normally because it is undergoing epairs or maintenance. Panamax Tanker or bulk carrier designed to navigate the Panama Canal, and therefore with a maximum breadth of metres. Normally, this unit does not exceed 80,000 dwt. Suezmax Tanker capable of navigating the Suez Canal with a full load; normally, between 120 and 200,000 dwt. to be named / TBR to be renamed New buildings or under acquisition waiting to be named or renamed. T/C rate Time Charter Rate Charter rate for making the ship available, with fuel costs, port fees, canal transit fees and other charges relative to the voyage paid by the charterer. Normally, this is expressed in dollars per day of ship availability (calendar days minus offhires). The present Report has been approved by the Board of Directors of S.p.A. during the meeting on the 14th of May The data shown has not been subject to review by the Auditing Company. The next communication on the Profit and Loss Account and on the Balance Sheet will be represented by the Semi Annual Report 2008 which will be made available within 29 August 2008.

8 Spa I16121 Genoa 4/28, via C.R. Ceccardi phone fax telex PREMU N (Monaco) SAM MC98000 Monaco L Estoril 31, av. Princesse Grace phone fax telex PREMD Four Handy Ltd. (opening Summer 2008) Four House Copthorne Common Road RH10 3LF Crawley West Sussex UK (Atlantic) Inc Houston Texas USA 4544 Post Oak Place, Suite 100 phone fax Australian FPSO Management Pty. Ltd. West Perth Western Australia Level 2 24, Kings Park Road phone fax