Results in 4th quarter 2007

Belships` operating income in the 4th quarter of
2007 was USD 19,444,000 (4th quarter 2006: USD
14,003,000). The company`s operating result was USD
24,865,000 (USD 1,960,000). The operating result
for the 4th quarter was strongly influenced by the
sale of the M/S Belnor, which produced a gain of
USD 22.6 million. The increase in operating income
is essentially connected with Elkem Chartering`s
handysize operations.
Profit after tax in the 4th quarter was USD
18,829,000 (USD 939,000).
The report for the 4th quarter was submitted in
compliance with IAS (International Accounting
Standard) 34, and consistent accounting principles
were applied in relation to the accounts submitted
at 31.12.2006.

Rates on the dry-bulk market reached a peak in the
4th quarter, when spot-market rates for capesize
vessels were close to USD 200,000 per day. Towards
the end of the quarter, problems in Brazilian
exporting ports for iron ore led to a drop in
demand and lower rates. Increasing disturbances on
financial markets may also have had a negative
impact on the market.
The results of Elkem Chartering handysize
operations developed satisfactorily. In the course
of the quarter, the most important contract of
affreightment were renewed on substantially better
terms. Belships` own tonnage, the M/S Belisland and
the M/T Belaia, as well as Elkem Chartering`s
handymax vessels, continued on their respective
time charters without any material interruptions.

The company`s solidity and financial position were
considerably strengthened in the course of the 4th
At 31 December, the Group`s cash position was USD
49.2 million, against USD 22.2 million at 30
September. Through the sale of the M/S Belnor, the
company`s liquidity was strengthened by USD 26
million, following settlement of the vessel`s
mortgage debt of USD 10.3 million. At the end of
the 4th quarter, the company`s mortgage debt
amounted to USD 20.0 million. In addition to this,
Belships has a debenture loan of NOK 100 million
(USD 18.3 million). This loan is has been hedged
against currency risks, and the unrealised gain
from this amounted to USD 2.6 million at 31
December. This amount has been booked under Other
fixed assets.
In the 4th quarter, USD 4.3 million was allocated
to deferred tax relating to the transitional rules
for accumulated liabilities under the previous
shipping tax regime. This amount includes estimated
tax on environmental allocations. However, taking
into account the deferred tax from operations
outside the shipping tax regime, the Group`s net
tax liability is small and estimated tax payable
for 2007 amounts to approximately USD 1.4 million.
The Board of Directors will propose to the General
Meeting declaring a dividend of NOK 1.00 per share.
In January 2008, the company acquired 50,000 own
shares at an average cost of NOK 16.92 and owns as
per today 710,000 own shares at an average cost of
NOK 9.89.
At the end of the 4th quarter, book value per share
amounted to NOK 10.80, while the book equity ratio
was 47.2%.
Charter parties for chartered in tonnage have
substantial values that are not reflected in the
company`s balance sheet.

The rates have continued to fall in the 1st quarter
of 2008. In addition to the problems in Brazil`s
iron ore ports, Australia`s coal exports have been
affected by flood damage. These circumstances will
gradually be normalised, and then we may see a new
market upswing. The disturbances on the US housing
market will probably lead to a financial setback in
the USA. To what extent this will affect the
freight market, is a subject of disagreement, but
it is hardly likely to be positive.
In the 1st quarter, Elkem Chartering increased its
cargo portfolio further and has good coverage in
relation to its access to tonnage. We expect higher
earnings in the company`s handysize operations in

Oslo, February 14, 2008


4th Quarter 2007