| Emitents | Latvijas kuģniecība, AS (48510000VYR04HZGC213) |
| Veids | Finanšu pārskati |
| Valoda | EN |
| Statuss | Publicēts |
| Versija | |
| Datums | 2012-04-27 13:55:01 |
| Periods | |
| Versijas komentārs | |
| Teksts |
JSC Latvian Shipping Company (hereafter – LSC) (NASDAQ OMX RIGA: LSC1R) and its subsidiaries (hereafter – LSC Group or Group) have published audited financial statements for 2011. The net loss of LSC Group in 2011 was LVL 24 million (USD 48.24 million), which is three times less than in 2010. In both 2011 and 2010 a considerable amount of the net
losses relates to asset impairments, provisions for which are
required to be made according to the International Financial
Reporting Standards. The impairment provisions made in 2011 are as
follows: (1) assets held for sale (3 older handy size vessels), in
the amount of USD 12.56 million, (2) total fleet value adjustment,
in the amount of USD 13.1 million, (3) value adjustment of
investment in real estate properties in the amount of USD 1.2
million.
This result reflects the continuing difficult financial
situation that ship-owners are experiencing with 2011 recording
historically low market rates. The reasons for this are varied and
complex but the main factors are less demand for oil products
caused by the global economic downturn especially within the more
developed western economies coupled with an increase in the number
of new tankers. Prior to 2008 strong global economic growth
stimulated demand for shipping and this encouraged the construction
of new tankers. The consequence of this increase in vessel supply
and current decrease in demand is lower earnings for
ship-owners.
During 2011 the Group took delivery of two new build
tankers, the “Latgale” and the “Zemgale” ordered in 2007 from
“Hyundai Mipo Dockyard Co., Ltd” shipyard in Korea. In 2011 LSC
sold two unbuilt liquefied petroleum gas carriers in order to
finance the two new build product tankers as well as the 17 year
old vessel “Indra” for scrap. Further, LSC has reclassified three
of its oldest vessels as assets for sale in order to ensure
sustainable financing for the remaining fleet.
In 2011 total net voyage result from shipping was USD 87.99
million (2010 – USD 88.31 million) and shows stabilization in
income. The net voyage result is calculated by deducting voyage
costs (bunkers, port and agent charges, etc.) from voyage income
and shows the company’s income, irrespective of whether the fleet
is employed in the spot or time charter market. Vessel operating
profit was USD 15.11 million, a 19.1% improvement on the previous
year (2010 – USD 12.69 million), however, the operating profit did
not cover the fleet financing expenses (USD 20.73 million).
At December 31, 2011 the total value of the LSC Group assets
was USD 651.92 million. The previous year the figure was USD 680.47
million. The decrease is mainly attributed to the impairment
provisions as explained above. The total value of the LSC Group
fleet has decreased from USD 570.50 million to USD 510 million and
in addition to the impairment provisions also reflects
depreciation. The total equity value of the Group at December 31,
2011 was USD 267.84 million (2010 – USD 313.92 million).
During 2011 significant litigation has continued in the
UK Courts with regard to substantial losses suffered in previous
years by LSC Group. A series of transactions concluded by the
previous management were also challenged through the courts in
Latvia regarding the dissipation of funds and other assets during
2010 and before.
Prospects for 2012
Given the very difficult financial environment the
global shipping market remains very challenging. Ship-owners in all
market segments are experiencing severe liquidity problems. LSC has
also been exposed to these difficult conditions but has been
cushioned from the worst effects with a majority of the fleet being
employed on time charter thus ensuring a more predictable income
stream.
However there are some signs for optimism for the
product tanker market. The level of recent closures of uneconomic
refineries in Western Europe and the USA is likely to increase
demand for oil products which will need to be supplied by the more
modern refineries that have been built, and will continue to be
built, in the middle and far-east. Additionally, economic growth in
emerging economies, for example South America and Africa, is also
expected to increase demand for product tankers.
Lastly it is expected that due to the current economic
environment, and with less banking finance available, that fewer
product tankers will be built. This should help to improve the
current in-balance between the number of product tankers and
product movements.
About JSC “Latvijas kuģniecība”(Latvian Shipping
Company)
In the medium-sized and handy tankers
categories JSC „Latvijas kuģniecība” (NASDAQ OMX
RIGA: LSC1R) is among the leading ship
owners in the world, and in terms of transport volumes of petroleum
products it is also in a leading position among similar
companies in Northern Europe. It owns 20 modern ships,
employing more than 700 professional and highly qualified seamen
from Latvia. The total carrying capacity of the LK fleet is
957 974 DWT and the average age of the fleet is 5.5
years. All ships have received ISM (International Safety
Management) certificates.
Ilze Nagla
Public Relations Manager JSC “Latvijas kuģniecība” Tel.: 29267454, 67715914 E-mail: ilze.nagla@vnafta.lv
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