Report 4th quarter 2011
2/23/2012 2:40 AM EST
Green Reefers ASA
Consolidated report 4th quarter 2011
· EBITDA at USDM -2.8 (USDM -3.1) in 4Q
· Establishment of new pool, GreenSea Pool
· Sale and leaseback of 6 vessels
Results 4rd Quarter 2011
The group experienced a pre-tax result of USDM -7.2 in
4Q 2011 (USDM -24.0).
The net operating income was USDM 15.4 in 4Q 2011
(USDM 20.2). Profit from sale of vessels is included
with USDM 2.1 (USDM
0.3).
Operating result before depreciation (EBITDA) was USDM
-2.8 (USDM -3.1).
Depreciations in the quarter are USDM -4.1 (USDM
-6.0). The decrease is mainly due to reduced number of
vessels, reduced
docking expenses and higher residual value of the
fleet due to increased steel prices.
Throughout the quarter, again, spot rates below the
level of the last seven years have been experienced.
We have to go back to
2001 - 2003 to find equally low levels. As the
majority of the Group's vessels are fixed for spot
voyages, the freight income
is all time low. This is mainly due to overcapacity
within the reefer industry in particular, but also for
shipping in
general. In addition, the extensive competition from
refrigerated containers has also resulted in increased
pressure on the
rates.
Continued high bunker prices and the weak market have
a negative effect on the Group's cash flow.
Unplanned technical off-hire (1.6%) was lower this
quarter compared to the same period last year (4.6%).
Fourth quarter
operational cost for the vessels was USD 5,023 per
day, also down compared with third quarter and the
same period last year
(USD 5,293 per day). 6 dockings were finalized during
the quarter of which 3 were started in last quarter,
compared with 6
dockings in the same period last year.
Result 2011
Pre-tax result for the year 2011 was USDM -30.7 (USDM
-52.5).
The Group's operating income reached USDM 69.6 in 2011
compared to USDM 140.7 last year. Figures of operating
income are not
comparable with 2010 as main principle for reporting
of operating income has changed due to various pool
arrangements in which
the Group joined during 2010. Operating income is at
present reported as net pool income after deduction of
voyage related
costs. The net operating income was USDM 69.6 in 2011
(USDM 87.9).
The EBITDA was USDM -6.1 (USDM -7.8).
Activities
Green Reefers owns 20 vessels at the end of the
quarter. In addition, 10 vessels are hired on bareboat
and two vessels on time
charter. The commercial activities are carried out by
Silver Green AS (6 vessels), Seatrade Reefer
Chartering N.V. (6 vessels)
and Green Sea Pool N.V. (20 vessels).
During the quarter, 6 vessels (penguin-class) have
been sold to the company's major shareholder.
Concurrently with the sale,
agreements regarding leaseback on bareboat-charter
parties were entered for a period of 7 years. The
transaction was
authorized at an extraordinary general meeting 20
October.
Finance and capital structure
Interest-bearing debt totals USDM 105.0 as of 31
December 2011 (USDM 149.7). Of the group's debt, 84 %
is in USD and 16 % in
EUR. Cash deposit was USDM 8.1 (USDM 13.4) by the end
of 4th quarter.
Booked equity 31 December 2011 was USDM 39.2 (USDM
67.7). Equity ratio was 25% (29%).
In total, the Group has increased it's cash deposit by
USDM 12 from the sale of 6 vessels, cf above. As part
of the
transaction a repayment of USDM 24 on the mortgage
loan took place. The transaction also involved an
agreement with the
company's mortgage banks regarding further
postponement of instalments until December 2013.
Subsequent events
From 1 January 2012 the Group establish GreenSea Pool
as a joint venture with the Seatrade Group. The Pool
will operate 20 of
the vessels controlled by Green Reefers as described
under 'Activities' above. At the same time, the
operations of Hamburg
Reefer Pool was discontinued and the company is under
liquidation.
The Market and prospects
The second half of this year has seen record low spot
rates, despite a better start of the year compared to
previous years.
The very weak marked in the quarter can be explained
by lack of cargo in general and fish in particular.
Less quotas /
catches, both in Norway and by the coast of West-
Africa has brought less demand for reefer tonnage.
The weak market has continued in 2012, also due to
excess tonnage, high bunkers prices and fierce
competition from container
lines. During 2011 42 vessels were sold for
demolishing, corresponding to 15 million cubic feet.
This represents a net
reduction in tonnage of approximately 5.7%. Equivalent
figure for 2010 was 44 vessels; 17.6 million cubic
feet. The high
bunkers costs and an aging fleet, are expected to lead
to continued high demolition activity in 2012.
2012 has begun at a very low level, but the company
hope for a modest improvement of the market situation
the coming months as
reefer cargo normally increases in this period of a
year. Future development for the Group will in high
degree depend on the
quantities of fish and fish quotas. The Group is also
exposed to the development in Eastern Europe and
Russia, as well as the
Mediterranean countries, markets which traditionally
have a demand for specialized reefer tonnage.
If the market rates continue at the present low level,
the company will need additional cash funding during
the year.
In general, the market for conventional reefer vessels
operators is expected to be challenging throughout the
next year. The
world's general economic trend, and in particular
Europe's, influence on import will determine the
demand for reefer tonnage.
Development in the oil price will also have a great
impact on revenues. Last but not least, the aggressive
competition from
reefer containers will be of great significance on the
cargo volumes allocated to the conventional reefers.
Bergen, 23 of February 2012
Green Reefers ASA
The Board of Directors
Kristian Eidesvik
Aage Thoen
Birthe C. Lepsøe
Anne-Sofie Utne
Eivind Eidesvik
Contact: Toril Eidesvik (CEO), tel: +47 55 36
25 00
Øystein Disch Olsrød (CFO), tel: +47
55 36 25