I.M. Skaugen ASA (IMS) reported a loss of USD 0.9 mill in 3Q99. Year-to-date loss is USD 3.7 mill, as compared to USD 7 mill for the same period last year. The Group reported an EBITDA result of USD 4.7 mill for this quarter, as compared to USD 4.2 mill in 2Q99, and a year-to-date result of USD 11.7 mill, as compared to USD 8.6 mill for the same period in 1998.
Earnings on an EBITDA basis have shown a positive trend throughout the year, reflecting the underlying conditions. The earnings development is positive in spite of the increased bunkers expenses, while the other expenses are according to plan. The quarterly result has been marked by non-accrued administrative expenses, loss of time in connection with the maintenance of vessels, increased financial expenses in connection with structural projects, offers to shareholders and a small unrealised share portfolio loss.
The underlying conditions indicate therefore that the EBITDA result for 4Q99 might be the best quarter this year.
1999 Third Quarter Highlights
* Signs of a cyclical upturn in the petrochemical industry - driven by improvements in the economy in the Asian region and expectations of improvements in Europe and Latin America. NGC's earnings reflect this.
* The efficiency improvements and cost reductions that we have carried out provide significantly improved margins for the NGC vessels when the market conditions for petrochemical gas transport improve.
* Our service concept is under development and showing results - IMS's business activities are therefore doing better than the operations of our closest competitors.
* We are expecting structural changes in the NGC segment now – these changes will be positive for this industry and NGC.
* Shares in I.M. Skaugen are underpriced compared to their historical pricing and the market in general.
* SPT has a high level of activity and satisfactory profit development with an EBIT margin* of 13%. This should therefore give shares in IMS extra value.
*EBIT in per cent of gross freight revenue.
EBIT - result before net finance and taxes.
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