Stena Bulk reports SEK billion profit for 2006

Stena Bulk finished yet another successful year with a profit of almost SEK 1 billion on sales of approx. SEK 4.5 billion. With a deployed fleet of 60 vessels totalling more than 6 million dwt, Stena Bulk is the largest tanker shipping company in Sweden. The company has a market share of 40% in the Caribbean, 20% on the North Sea and 15% in the Baltic Sea.

“This is the third consecutive year in which we have generated an extremely good profit. In fact, we could have posted a new profit record if we hadn’t decided instead to utilise extra depreciation. Our excellent figures are partly the result of profits on the sale of five tankers in combination with a strong spot market, although obviously it is also important in a long-term perspective to be able to read the market in order to buy/sell at the right time. This will continue to be an important component of our business activities”, says Ulf G. Ryder, President & CEO of Stena Bulk.

A total of about 2,000 persons are involved in Stena Bulk’s activities, including about 50 persons ashore at offices in Gothenburg, Houston, London, Moscow, Singapore and Beijing.

Five new vessels were delivered in 2006 and a further six have been ordered for delivery up until 2010. These six units are all so-called Stena P-MAX tankers and will join the fleet of ten vessels of the same design, which Stena Bulk manages operationally and commercially on behalf of its listed sister shipping company Concordia Maritime.

“In 2006, we transported approx. 10 million tons of oil via the Baltic Sea, which is equivalent to a market share of 15% of the total volume of Russian oil exports via the Baltic Sea. This year, we are focusing on increasing our share of this expansive market. We will also concentrate on creating a niche position for ourselves in Asia with a specific focus on China and the eastern side of Russia”, continues Mr. Ryder.

“Our assessment for 2007 is that the many vessels to be delivered during the year will result in overcapacity in the global market and, as a consequence of this, it is likely that freight rates will fall 50%. However, thanks to the very profitable years we have behind us, we have the financial strength to once again make major investments if suitable opportunities arise”, concludes Mr. Ryder.