Skaugen Goes to Red Again
Norwegian Marine Transportation Service Company I.M. Skaugen SE reported interim losses but cautiously positive and expecting a gradual recovery of trading opportunities for long routes the petrochemical market.
The gas carrier owner reported profit before and after tax of minus $ 5.1 million (loss) in Q2 2016. The same quarter a year ago profit before and after tax minus $ 0.5 million. Freight revenues amounted to $ 18.5 million in this year's 2nd quarter, against 15.7 million in last year.
I.M. Skaugen SE’s (IMSK) core business is liquefied gas transportation. The fleet of 15 advanced gas carriers is operated in a revenue sharing pool managed by Norgas Carriers Pte Ltd. The Norgas Carriers segment generated revenues of USD 58.3 million in 1H 2016 of which USD 36.7 million was IMS’ share on a proportional consolidated basis.
Economic performance improved in 1H16 vs 1H15 as underlying time charter equivalent earnings of the Norgas Carriers fleet increased with 30% vs 1H15. The average earnings of the Norgas Carriers fleet of gas carriers are almost back to a level equal to the 10-year historical average.
Supported by lower administration and operating costs, the EBITDA increased further with 85% in 1H16 vs 1H15, and EBIT improved to negative USD 0.9 m in 1H16 from negative USD 6.8 m in 1H15.
The current order book for similar sized vessels for small scale LNG and liquefied gas transportation is low. For smaller LNG vessels we can note a global order book of only 5 smaller sized LNG vessels where 3 are targeted for specialized marine bunkering operations and 1 vessels is tied up in a long term charter contract, says the company.
In addition, the remainder of the current sailing fleet of small-scale LNG vessels is currently tied up in longer charter agreements. This gives I.M Skaugen a continued and unique position to provide suitable LNG tonnage for our clients in the near to medium term, especially where early delivery of vessels is required to ensure the early start-up of projects.
"We remain cautiously positive and expect a gradual recovery of the trading opportunities in the longer haul petrochemical gas markets. The recovery that we have seen in 2H15/1H16 is expected to continue into 2H 2016/17 with regards to petrochemicals, " says the company statement.
