TRANSATLANTIC: INTERIM REPORT JANUARY - SEPTEMBER 2008
Strong earnings for both the Offshore/Icebreaking and Industrial Shipping business areas
For the January to September period, profit after tax rose by 29% to SEK 203 M (157).
Profit after tax for the third quarter signified an improvement by 41% to SEK 83 M (59)
The Group's net revenue increased to SEK 1,532 M (1,430)
Net profit per share amounted to SEK 7.30 (5.50).
On a rolling 12-month basis, the Group's operating profit amounted to SEK 321 M, corresponding to SEK 11.50 per share.
The offshore spot market in the North Sea was very strong, with high rates and high capacity utilization. During October, all four offshore vessels reported record earnings of approximately GBP 160.000 - 175,000/day.
Earnings for Industrial Shipping continued to improve successively through increased integration and more marketing. The ddiscussions' about sale of part of the Atlantic division continues.
Anders Källström will assume the position of President on November 1, 2008.
Results for January - September 2008: Net revenue: SEK 1, 532 M (1,430) Operating profit before tax: SEK 215 M (174)* Profit before tax: SEK 220 M (172) Profit after current tax: SEK 220 M (172) Profit after full tax: SEK 203 M (157) On September 30, 2008 shareholders' equity amounted to SEK 46.90/share (SEK 43.60/share on December 31, 2007) The equity/assets ratio on the closing date was 41% (39% on December 31, 2007) Return on equity: 21% (18%) Return on capital employed: 14% (12%)
* Operating profit: Earnings before tax and restructuring costs The figures above relates to continuing operations and excludes the parts of Transatlantic Services held for sale.
Transatlantic's operations, goals and strategy Transatlantic consists partly of the Offshore/Icebreaking business area and partly of the Industrial Shipping business area. The operations of the Offshore/Icebreaking business area are based on combination vessels operated on long-term contracts and guaranteed income for icebreaking, in addition to other deployment, mainly for rig-relocation in the offshore market. Industrial Shipping focuses on contract traffic for primarily all basic industries in the Nordic region.
Transatlantic's business concept is to market, develop and deliver the market's most efficient transport solutions in close and active cooperation with customers.
Transatlantic's goal is to be the market leader in its segment, with profitability that generates a favorable return for shareholders. The goal is a return of at least 12% on shareholders' equity and an equity/assets ratio that does not fall below 30%.
The Group's strategy for the next few years emphasizes growth and sustainable profitability. Growth will be achieved organically and through acquisition. The Group is also very open to the development of various partnerships aimed at broadening operations or implementing various investments and projects.
The ambitions for growth will require investments in new tonnage and replacement tonnage. These will be conducted without jeopardizing the Group's financial objectives. This also means that the Group's tonnage requirements will be partly resolved through charter contracts and by external investors becoming wholly or partly involved in the fleet operated by the Group.
The strategy for and development of the Group places major demands on quality, safety and the environment, as well as awareness of customer demands and a willingness to change.
General developments during the third quarter
During the third quarter of the year, continued favorable shipping trends were reported despite the turmoil in the financial market and very high oil prices. Capacity utilization in the transatlantic segment was generally strong. Within the Offshore/Icebreaking business area, there was higher demand for the division's vessels since activities increased and the number of vessels is somewhat fewer in the spot market. The Industrial Shipping business area developed positively despite the effects of the continued weak US dollar on export volumes from Europe to North America.
The Offshore/Icebreaking business area noted stronger demand for the division's AHTS vessels during the quarter, compared with the year-earlier period. A gradual increase in demand for AHTS tonnage was noted as a result of the high level of activity among oil companies, fewer available vessels in the spot market and poor weather in the area causing the extension of several assignments. Market rates gradually increased and reached record levels at the end of the period.
The business area's profit was SEK 66 M (52).
The Industrial Shipping business area improved its profit for the remaining business, which totaled SEK 35 M (19) for the quarter. The earnings improvement was a result of implemented rationalizations and restructuring measures. During the period, no major operational disruptions were noted. Evaluation of resource utilization continues with the aim of achieving the Group's overall profitability targets. Profit for the Transatlantic division was SEK 15 M (8) for the quarter, while the European Services division reported a profit of SEK 20 M (11).
Consolidated earnings for the period January - September 2008
The Group's net revenues amounted to SEK 1,532 M (1,430). The increase in sales was due partly to new ship management assignments pertaining to crewing and operating the Swedish government's icebreakers and another external vessel, and partly the increase in revenues for the Industrial Shipping business area, compared with the year-earlier period.
The Group's operating profit before tax amounted to SEK 215 M (174). Profit before tax was SEK 220 M (172). Earnings include positive restructuring items of SEK 5 M, mainly attributable to the sale of the M/S Holmön. Net profit after full tax was SEK 203 M (157).
(For full report see attached file)
Viking Supply Ships AB (publ) is a Swedish company with headquarter in Gothenburg, Sweden. Viking Supply Ships A/S is a subsidiary of Viking Supply Ships AB (publ). In addition Viking Supply Ships AB (publ) has the subsidiary TransAtlantic AB. The operations are focused on offshore and icebreaking primarily in Arctic and subarctic areas as well as on RoRo and container feeder services mainly between the Baltic Sea and the Continent. The company has in total about 800 employees and the turnover in 2014 was MSEK 3,190. The company’s B-shares are listed on the NASDAQ Stockholm, Small Cap segment. For further information, please visit: www.vikingsupply.com