- For the year, I.M. Skaugen Group (IMS) reported a net pre-tax result of USD11.0 million (USD20.6 million in 2005). The result on an EBITDA basis was USD34.7 million (USD46.3 million in 2005). About half of the reduced EBITDA earnings, from last year, is related to overall increased costs in the Norgas operations and the balance is due to lower earnings of SPT that again is mainly due to the increased cost of tankers that SPT hires.
- At the Annual General meeting on 1 March 2007, the Board will recommend a dividend payment of NOK1.75 per share (NOK2.50 in 2006 and NOK1.88 in 2005). This dividend represents approximately 4 per cent direct yield on the share price of NOK 44.00 at year-end.
- Through the efforts made within our IMS business during 2006, we are well placed in 2007 to further develop our operations in Norgas, SMC and improve the performance of SPT.
Overall trading conditions for Norgas for the year were favorable.
IMS created a new division in 2006, Skaugen Marine Construction (SMC). Through SMC we have streamlined our marine construction activity in China for building of new gas carriers. With responsibility for all aspects of this programme including managing our Chinese joint venture partnerships - the work of SMC is key to the future financial and operational success of the Group. The pioneering new build programme comprises 16 vessels for delivery between now and 2010, 12 of these have been confirmed and one has been delivered. We are building a number of 10,000 cbm vessels that have the ability to carry LNG, in addition to ethylene, LPG and other petrochemical gases. Norgas will be the first company ever to offer this configuration of vessel to customers.
The first SMC ship - "Mei Wen Ti", a 3,200 cbm pressurized LPG carrier - was delivered on budget on January 3rd, 2007. The delivery signals a new era within I.M. Skaugen - an era where new, high quality gas carriers will be delivered approximately every six months at a price substantially below what our competitors are paying. It enables us to renew and expand our fleet, with vessels that will offer special capabilities and added flexibility, at attractive price levels.
Trading conditions for SPT were difficult throughout the year, but improved in the second half of the year. However, a drop in crude prices in 4Q06 caused oil companies to reduced imports into the US in order to work off inventories of their more expensive crude.
In 2006, the weighted average tanker cost has been a challenge for SPT in a very strong tanker market. With the delivery of six new purpose built Aframax tankers commencing in mid-2007 and ending early 2008, the tanker cost will come down as the vessels will be taken on attractive long term bareboat charters.
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.
Listed on the Oslo Stock Exchange, I.M. Skaugen ASA (IMSK) - www.skaugen.com - is a Marine Transportation Service Company engaged in the hassle free transportation of petrochemical gases and LPG, ship-to-ship transfer of crude oil and LNG, as well as the design and construction of smaller and specialized high quality marine vessels.
IMSK is a fully integrated shipping company that designs, builds, owns, mans and manages our own ships. IMSK customers are major international companies in the oil and petrochemical industry, whom we serve worldwide from our operations in Dubai (UAE), Freeport and Houston (Texas), Oslo (Norway), Singapore Sunderland (UK), Nanjing, Shanghai, Taizhou, Zhangjiagang and Wuhan (China). IMSK operates recruitment and training programmes in St. Petersburg (Russia) and Wuhan (China) for the crewing of vessels.
IMSK employs approx. 1,500 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 (China) and a small number of workboats for Skaugen PetroTrans (SPT).
IMSK has a comprehensive newbuilding project in China where it has two LPG vessels of 3,200 cbm; three purpose designed combination carriers with LPG/Ethylene/VCM and Organic chemicals carrying capability and up to ten advanced 10,000 cbm LNG/LPG/Ethylene gas carriers are on order for Norgas for delivery from beginning 2007 and onwards. IMSK has invested in infrastructure with both a shipyard and a 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.