In the 1st quarter of 2008 JSC Latvijas kuģniecība (Latvian Shipping Company – LASCO) Group has been proceeding with the implementation of its strategic goal set – to ensure increase of LASCO value securing its place among the top ten medium size tanker owners in the world. During the report period the core business of LASCO was successful and proves efficient and professional commercial management of LASCO fleet - vessel operating profit has reached USD 18,6 million improving the result for the respective period in 2007 by USD three million.

Regardless of the unfavourable impact of various external factors on company’s performance, LASCO net profit is USD 15,4 million. The difference in profit, compared to the respective period last year, is connected with the sales of vessels in the 1st quarter of 2007.

During the report period LASCO assets have grown reaching USD 877,0 million on March 31, 2008. The un-audited equity of the Group comprises USD 504,3 million  at the end of the report period. 

The core business of LASCO Group is worldwide cargo shipments among the ports. At the end of the 1st quarter the fleet in LASCO commercial management consisted of 45 vessels – 38 tankers, two LPG carriers, four reefer vessels and one dry cargo ship.

At the beginning of the report period the tanker voyage charter rates had fallen to their lowest level of the decline experienced at the final quarter of 2007 and the market recovery commenced. In the 1st quarter of 2008 the vessel operating profit of the tanker fleet has reached USD 14,2 million exceeding the result by USD 2,7 million for the corresponding period the year before.

The LPG carriers of the LASCO fleet continued to operate with profit within the ScandiGas pool during the 1st quarter of 2008. However due to unusually warm weather conditions leading to lower energy consumption the performance of the LPGs has been USD 0.9 million lower compared to the result the year before.

In the 1st quarter of 2008 LASCO reefer vessels have been employed in time charter in accordance with an agreement signed. The overall results of the reefer vessel operations have been higher during the report period than a year before.

The dry cargo vessel of LASCO fleet continued to work in accordance with a time charter agreement generating solid and predictable profit of almost USD 0,3 million (LVL 0,1 million, EUR 0,2 million).

 “I am satisfied with the good results of the first quarter – they have been achieved in low market situation and grace to practical knowledge and experience of our specialists. Even though the freight rates have stabilized after the decline experienced at the end of the last year, their growth is hardly expected during 2008. Therefore we are paying particular attention to efficient operational performance and exploitation of the resources”, underlines Imants Sarmulis, Chairman of LASCO Management Board.

In the 1st quarter of 2008 LASCO took the delivery of one tanker newbuilding Užava from 3.Maj within the Tanker Fleet Renewal Programme. Completing the Tanker Fleet Renewal Programme LASCO will take delivery of two more tanker newbuildings from 3.Maj shipyard in Croatia. One of them – Salacgrīva has been launched on April 26 this year.

In accordance with the tanker fleet development scenario foreseen in LASCO Operations Strategy for the period till 2015, there are four medium range 52 000 DWT tankers being built at Hyundai Mipo Dockyard Co., Ltd in Korea.  The optimum parameters of the tanker newbuildings ordered will provide for their comprehensive employment in oil product, chemical cargo and vegoil shipments.

More detailed information:
Marita Ozolina-Tumanovska
Head of PR Department
Phone: +371 67020120, 29287169
E-mail : marita.ozolina@lscgroup.lv