Havila Shipping ASA - Third quarter accounts

Friday, 23. October 2009 09:32
FINANCIAL ITEMS CONTRIBUTED TO THE SECOND BEST QUARTER EVER
Summary
* Havila Shipping ASA achieved a result before tax of NOK 295.9m in
Q3 2009, compared with NOK 16.9m in Q3 last year. Year to date, the
profit before tax was NOK 574.5m. Year to date 2008 profit before
tax was NOK 345.6m, whereof NOK 311.8m was profit from sale of
assets.
* Net financial items include net unrealised agio on currency
positions and forward rate contracts of NOK 242.6m and NOK 388.3m
for 3rd quarter and year to date, respectively. This includes a
gain of NOK 128.9m related to redemption of a bond loan in Iceland.
* Total income in Q3 2009 ended at NOK 216m, compared to NOK 216.8m
in Q3 2008. Year to date total income ended at NOK 677.8m. Year to
date 2008, total income was NOK 828.0m, whereof NOK 311.8m was
profit from sale of assets.
* The group had 19 vessels in operation per 30/09/2009. This
includes Havila Mars and Havila Mercury that was sold and leased
back in Q1 2008, four vessels that are operated by the joint
venture company Posh Havila Pte Ltd in Singapore and two vessels
that are owned by PR Havship DA and PR Havship II DA.
The spot market for offshore service vessels was weak during third
quarter. Day rates have been low, and over-supply of vessels has
resulted in low utilisation for both PSVs and AHTS.
Of owned vessels, the group had two PSVs and one AHTS vessel in the
spot marked during the quarter. One of the PSV vessels has in average
achieved day rates lower than the operating costs. The AHTS vessel
had acceptable day rates, but low utilisation. The objective of the
group is now to achieve longer contracts for several of the vessels
that are operating in the spot market.
The company's financial figures and comparative figures are prepared
in accordance with IFRS regulations.
Q3 2009 results
Total income for Q3 2009 amounted to NOK 216m (NOK 216.8m).
Total operating expenses for Q3 2009 were NOK 111.1m (NOK 102.4m).
The operating profit after depreciation (EBIT) in the period was NOK
70.4m (NOK 89.5 m).
Net financial income in the period amounts to NOK 220.6m (NOK
-75.1m), and includes gain on redemption of a bond loan in Iceland of
NOK 128.9m. Further are net financial items positive in the period
due to unrealised agio on other loans in foreign exchange and change
in value of derivatives.
The profit before tax for Q3 2009 was NOK 295.9m (NOK 16.9m).
Tax is calculated as 28% of tax basis for the taxable companies in
the group. The year-to-date calculated tax increases specially as a
consequence of financial income. The tax expense for Q3 2009 is NOK
55.6m (NOK -5m), and is among other factors related to gain on
redemption of a bond loan in Iceland.

Results year to date 2009
Total operating income as of 30 September 2009 ended at NOK 677.8m
(NOK 828.0m whereof NOK 311.8m was profit from sale of assets).
Total operating expenses of NOK 326.3m (NOK 275.9m) include leaseback
expenses for Havila Mercury/Mars of NOK 81.3m (NOK 77.7m).
Net financial income year-to-date amounted to NOK 307.1m (NOK
-137.5m).
Profit before tax year to date 2009 was NOK 574.5m (NOK 345.6m).
Balance and liquidity per 30/09/09
Based on the estimates of several independent brokers dated 30/06/09,
the fleet had a market value of NOK 4 081m at the end of September.
This is equivalent to a value per share of NOK 157. The book value of
the fleet excluding new buildings is NOK 3 208m. Book equity per
share is NOK 103. Capitalized advance payments on new buildings total
NOK 961.1m and NOK 923.6m on 30/09/09 and 31/12/08, respectively.
Total current assets amount to NOK 832.6m on 30/09/09, whereof bank
deposits are NOK 491.5m (of this NOK 22.5m restricted).
On 31/12/08, total current assets amount to NOK 1 060.8m, whereof
bank deposits are NOK 698.2m (of this NOK 391.5m restricted). Net
cash flow from operations per 30/09/09 was NOK 133.5m (NOK 4.8m).
Cash flow from investing activities year-to-date 2009 is NOK -1 077m
(NOK 98m). This primarily relates to delivery of vessels. Raising and
repayment of loans and sale of own shares constitute a net change
from financing activities of NOK 655m (NOK -111.1m).
Total long-term interest-bearing debt at 30/09/2009 is NOK 2 733.3m.
This includes bond loans of NOK 621.1m. Of long-term interest-bearing
debt, 10% is loan in USD, while the remainder is nominated in NOK or
the foreign exchange rate is fixed. The bond loan in Icelandic krona,
where the foreign exchange rate was fixed as of 30/09/09, is redeemed
in October 2009. Next year's repayment of debt is classified as
current liability in conformity with IFRS, and amounts to NOK 167.9m.
Interest- bearing short term debt amounts to NOK 100m. Non-current
liabilities relating to deferred tax in connection with the
transition to the new shipping tax regime, is recognised at NOK
41.6m. "Environment fund" of NOK 25.7 mill is included in equity as
of 30 September 2009.
Market
The market for offshore service vessels was weak during third
quarter. Over-supply of vessels has resulted in low day rates, but
the rates were increasing at the end of the quarter. The group's
fleet utilisation, for vessels that are operating from Norway, has
been 92% in the third quarter. The group expects that the spot market
in the fourth quarter also will be weak. The rate level for longer
contracts is better than in the short term market. Increased subsea
activity, will result in an increased demand for vessels specially
designed for such operations. Strict requirements for tonnage
quality, emissions and technical competence will be key factors in
the period ahead.
Financing
Loan agreements entered into in June assumed participation from GIEK.
In August, a letter of intent from GIEK was received. This ensures
financing of the remaining vessels for delivery during 2009 and 2010.
Fleet
Per today, Havila Shipping ASA operates 20 vessels and has further 5
vessels under construction. Four of the vessels are operated by the
joint-venture company in Singapore, Posh Havila Pte. Ltd and two of
the vessels are owned by companies outside the Group, PR Havship DA
and PR Havship II DA.


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