TRANSATLANTIC: INTERIM REPORT JANUARY - SEPTEMBER 2007
Continued positive trend
Net revenue: SEK 1,871 M (1,631)
Operating profit before tax: SEK 174 M (147)
Profit before tax: SEK 172 M (142)
Profit after current tax: SEK 172 M (142)
Profit after full tax: SEK 157 M (133)
On September 30, 2007, shareholders' equity per share amounted to SEK 42.30 (37.90 per share on December 31, 2006).
The equity/assets ratio on the closing date was 39% (40% on December 31, 2006).
Operating profit before tax: SEK 174 M (147)
Profit before tax: SEK 172 M (142)
Profit after current tax: SEK 172 M (142)
Profit after full tax: SEK 157 M (133)
On September 30, 2007, shareholders' equity per share amounted to SEK 42.30 (37.90 per share on December 31, 2006).
The equity/assets ratio on the closing date was 39% (40% on December 31, 2006).
Transatlantic's operations, goals and strategy
Transatlantic consists of the Industrial Shipping business area, which comprises two divisions - Transatlantic Services and European Services - and the Offshore/Icebreaking business area. Transatlantic Services and European Services focus on contract shipping, primarily for the forest products and steel industries. The operations of the Offshore/Icebreaking business area are based on combination vessels on long-term contracts and guaranteed income for icebreaking, in addition to other deployment, mainly for rig-relocation in the offshore market.
Transatlantic consists of the Industrial Shipping business area, which comprises two divisions - Transatlantic Services and European Services - and the Offshore/Icebreaking business area. Transatlantic Services and European Services focus on contract shipping, primarily for the forest products and steel industries. The operations of the Offshore/Icebreaking business area are based on combination vessels on long-term contracts and guaranteed income for icebreaking, in addition to other deployment, mainly for rig-relocation in the offshore market.
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 segments, with profitability that generates a favorable return for shareholders. The goal is a return of not less than 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 include all divisions and will be conducted without jeopardizing the Group's financial targets. 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 development during the third quarter
During the third quarter, shipping trends were generally favorable as a result of a continued positive global economic trend.
Within Transatlantic's segments, demand and deployment was generally favorable but the summer period had a negative effect on certain operations, resulting in lower deployment and a decline in earnings.
The Offshore/Icebreaking business area noted an increase in deployment and improved freight rates.
In the Industrial Shipping business area, the European Services Division reported a continued favorable volume trend and revenue growth during the period, but lower demand during July and August resulted in reduced earnings and lower profits in scheduled traffic.
The Transatlantic Services division recorded continued imbalance, which adversely impacted capacity utilization.
The Offshore/Icebreaking business area noted an increase in deployment and improved freight rates.
In the Industrial Shipping business area, the European Services Division reported a continued favorable volume trend and revenue growth during the period, but lower demand during July and August resulted in reduced earnings and lower profits in scheduled traffic.
The Transatlantic Services division recorded continued imbalance, which adversely impacted capacity utilization.
The Industrial Shipping business area improved its operating profit, which amounted to SEK 21 M (18) for the quarter.
Operating profit for the division amounted to SEK 11 M (9).
The Offshore/Icebreaking business area improved its demand compared with the trend in the second quarter, which resulted in increased deployment and earnings. During the quarter, two vessels commenced long-term contracts, while two vessels were deployed in the spot market in the North Sea. Operating profit for the business area amounted to SEK 52 M (64).
Consolidated operating profit for the third quarter was SEK 65 M (79).
Consolidated earnings
The Group's net revenues for the first nine months amounted to SEK 1,871 M (1,631). Revenues for the three divisions increased slightly by more than 21%, while revenues for external ship-management assignments declined by SEK 59 M.
For the first nine months, the Group's operating profit totaled SEK 174 M (147) and on a rolling
12-month basis, the Group's earnings amounted to SEK 243 M.
12-month basis, the Group's earnings amounted to SEK 243 M.
Profit before tax totaled SEK 172 M (142). Results include restructuring expenses of
SEK 2 M (expense: 5).
Net profit after tax for the nine-month period amounted to SEK 157 M (133).
(For full report and tables see attached file.)