The I.M. Skaugen Group announces a pre-tax profit of USD2.9 mill. for 3Q06. This compares to a pre-tax profit of USD0.7 mill. for 3Q05 and USD0.6 mill. for 2Q06. The result for 3Q06 on an EBITDA basis is USD8.8 mill. (USD10.6 mill. for 3Q05 and USD5.7 mill. for 2Q06).
The Group is engaged in three business segments. Norgas comprises the group's gas transportation activities, the new division Skaugen Marine Construction (SMC) manages all our new building activities in China and SPT is involved in ship-to-ship transfer of primarily crude oil.
With SMC now in place as a new division we have one company that comprises (and manage) all the Groups newbuilding activities in China; including the Joint ventures that are engaged in newbuilding of ships and pleasure boats. Through SMC we will also develop "third party" newbuilding projects, being able to offer high quality turnkey vessels, at competitive prices. Starting now and going forwards, SMC will be reported as a separate segment within the IMS group.
Building upon the successful launch, and being very close to completion date of the first 3,200cbm LPG vessel, we decided in September to commence to build a third 3,200cbm LPG vessel. We are pleased to see the level of quality, the diligence and competence offered by all participants in our Chinese newbuilding structure.
Norgas: The trading conditions improved somewhat in 3Q06 and we where subject to reduced idle time. The freight rates have remained at acceptable levels, while most costs have increased through the period. It is expected that the gas transportation market will remain at similar levels for the balance of 2006.
SMC continues its positive progress with the newbuilding program. On September 25th the first 3.200 cbm pressurized LPG vessel was successfully launched at the yard in Taizhou. This first, of our 16 vessel newbuilding program for gas carriers, will be delivered at our original estimated cost.
The activity in SPT remained stable from 2Q06 for full ship lightering operations in the Gulf of Mexico, while we saw an increase in the number of support service operations. This, combined with somewhat lower tanker charter costs, results in a positive net result from SPT.
In July, SPT acquired Melbourne Marine Services (will be named SPT Marine Services); a UK based lightering support company, and will thereby gain access to European-, Russian- and African markets. SPT also completed the first ever commercial ship-to-ship transfer of LNG in August.
IMS has also entered into another JV in China that will establish, develop and manage the Wuhan Marine Equipment Industry Park in Wuhan, Hubei Province, China. The company will perform park planning and development, as well as property management, construction of facilities and provide training, consultancy services and assistance for establishment of new entities. The Group now participates in 10 establishments in China and of which 7 are Joint Ventures.
Oslo, October 9th 2006
I.M. Skaugen ASA
Board of Directors
If you have any questions, please contact:
Bente Flø, Chief Financial Officer, on telephone +47 23 12 03 30/+47 91 64 56 08 or by
e-mail: bente.flo@skaugen.com. This press release is also available on the Internet at our website: http://www.skaugen.com.
I.M. Skaugen ASA is a Marine Transportation Service Company engaged in the hasslefree transportation of petrochemical gases and LPG, ship-to-ship transfer of crude oil and LNG, as well as building of small and specialized high quality marine vessels. Our customers are major, international companies in the oil and petrochemical industry, whom we serve worldwide from our operations in Dubai, Freeport (Texas), Houston (Texas), Nanjing, Oslo, Shanghai, Singapore, Sunderland (UK) and Wuhan. I.M. Skaugen operates recruitment and training programmes in St. Petersburg, Russia and Wuhan, China for the crewing of its vessels.
The Group employs approximately 1,100 people and currently operates 44 vessels worldwide. The fleet comprises petrochemical gas and LPG carriers, Aframax tankers, vessels and barges for the transportation of gases on the Yangtze River and a small number of workboats for SPT.
The Group has a comprehensive newbuilding project in China where we have three LPG vessels of 3,200 cbm; three purpose designed combination carriers with LPG/Ethylene/VCM and Organic chemicals carrying capability and four advanced 10,000 cbm LNG/LPG/ethylene gas carriers are on order for Norgas for delivery from late 2006 and onwards.. There is an agreement to purchase up to six additional such 10,000 cbm vessels. IMS has invested in infrastructure with both a shipyard and cargo plant maker in China to ensure innovative and flexible vessels at low cost. Six new, purpose designed and built "Aframax sized tankers", are on order for delivery to SPT on a long term Bareboat charter and commencing during 2007.