Nordic Shipholding A/S
Q1 Result 2015

Nordic Shipholding A/S 

27.05.2015 07:34

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May 27, 2015

NORDIC SHIPHOLDING A/S
Company Announcement: 04/2015


Published via NASDAQ OMX on May 27, 2015

Q1 Result 2015

Summary



The comparison figures for period ended 31 March 2014 are stated in parenthesis.

This Q1 report covers the period 1 January 2015 to 31 March 2015.

The Group made a good result in Q1 2015, generating a profit before tax of USD
2.7 million as compared to a loss before tax of USD 1.1 million in the same
quarter last year. The better performance in Q1 2015 was due to higher average
rates from the vessels deployed in Handytankers Pool, higher TCE income from
the 3-year time-charter locked in for the LR1 vessel (Nordic Anne) and lower
vessel operating expenses. 

Gross revenue earned in Q1 2015 decreased slightly by 4.6% as the Q1 2015
revenue comprised freight income from the vessels in the Handytankers Pool and
time-charter income which is net of voyage expenses from the LR1 vessel (Nordic
Anne), whilst the Q1 2014 gross revenue represented freight income from the 2
pools. 

TCE earnings rose 24.9% to USD 9.2 million (USD 7.3 million) in Q1 2015 due to
higher TCE earnings for the vessels in the Handytankers Pool arising from
reduced bunker expenses and higher TCE income from the 3-year time-charter
locked in for Nordic Anne. 

Expenses relating to the operation of vessels in Q1 2015 decreased 27.9% to USD
3.4 million (USD 4.7 million). The significant cost savings in Q1 2015 was
attributed to the change of technical managers in 2014 and one-off cost
incurred in 2014 (USD 0.6 million) relating to the change of technical
managers. 

EBITDA increased  to USD 5.2 million (USD 1.2 million) as a result of improved
earnings in Q1 2015 and one-off costs incurred in Q1 2014 arising from the
change of technical managers amounting to USD 0.6 million and higher
professional fees due to the restructuring in December 2013. 

Depreciation amounted to USD 1.7 million (USD 1.5 million).

Net finance expenses were slightly lower at USD 0.8 million (USD 0.9 million)
as the working capital loan was repaid in full in December 2014. 

The result after tax improved significantly in Q1 2015 to USD 2.7 million as
compared to Q1 2014 (-USD 1.1 million). 

Under the loan agreement, cash in excess of USD 6.0 million will be used to pay
down the loan facility. During Q1 2015, this cash sweep mechanism was activated
and USD 1.1 million was used to pay down the loan, in addition to the regular
loan amortisation. 

Cash flow generated from operations was USD 5.2 million (USD 1.1 million)
mainly from the distributions earned by the Handytankers Pool and time-charter
income received for Nordic Anne, offset by payment of periodic interest
expenses on the term loan.  The Group invested USD 0.2 million in dry-docking
and made a partial repayment of USD 2.1 million on the term loan facility. 

Cash balance as at 31 March 2015 was USD 7.4 million (USD 6.3 million).

In Q1 2015, the average daily TCE rate earned by the vessels in the
Handytankers Pool was better than the forecasted daily rate, whilst the TCE
rate earned by the LR1 vessel (Nordic Anne) tracked the forecast. 

Despite the Q1 2015 result, the full year forecasted financials remain
unchanged, as uncertainty exist for the full year, which is also in line with
the commercial managers' forecast. Barring unforeseen circumstances, the Group
expects the TCE revenue from the 5 product tankers in the pool and the
time-charter income from Nordic Anne to be in the region of USD 29.0 million -
USD 32.0 million for 2015. The EBITDA (earnings before interest, tax,
depreciation and amortisation) is expected to be in the range of USD 13.0
million - USD 16.0 million while result before tax is expected to be between
USD 3.0 million - USD 6.0 million. The Group does not expect any write-downs of
vessels' carrying value unless significant weakness in the product tanker
sector sets in. 

The Group's cash flows is expected to be USD 5.0 million - USD 8.0 million
after accounting for USD 4.0 million of loan amortisation in 2015. Under the
loan agreement with the lending banks, cash in excess of USD 6.0 million will
be used to pay down the loan facility. This cash sweep mechanism was activated
in Q1 2015 and is anticipated to be also activated after Q1 2015. As mentioned
in 2014 Annual Report, approximately USD 3.0 million - USD 6.0 million of
excess cash is expected to be used to pay down the loan in 2015.  This loan
prepayment arising from the cash sweep is in addition to the regular loan
amortisation. 

The Board continues to source for suitable investment opportunities to grow the
Company and seeks to maximise returns for shareholders. 



For further information, please contact:

Knud Pontoppidan, Chairman of the board, Nordic Shipholding A/S: +45 39 29 10 00
News Source: NASDAQ OMX



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Language:     English
Company:      Nordic Shipholding A/S
              
               
              Denmark
Phone:        
Fax:          
E-mail:       
Internet:     
ISIN:         DK0060083996
WKN:          
 
End of Announcement                             DGAP News-Service
 
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