LONDON, Oct. 16, 2003 (PRIMEZONE) -- Stolt-Nielsen S.A. (Nasdaq:SNSA) (OSE:SNI) today reported results for the third quarter and the nine-month period ended August 31, 2003. Net loss for the latest quarter was $36.2 million, or $0.66 per share, on net operating revenue of $774.8 million, compared with a net income of $1.8 million, or $0.03 per share, on net operating revenue of $753.2 million for the third quarter in 2002. The basic weighted average number of shares outstanding for the third quarter of 2003 and 2002 was 54.9 million.Net loss for the nine-month period ended August 31, 2003 was $99.6 million, or $1.81 per share, on net operating revenue of $2.3 billion, compared with net loss of $1.7 million, or $0.03 per share, on net operating revenue of $2.0 billion for the same period of 2002. For the nine-month period of 2003 and 2002, the basic weighted average number of shares outstanding was 54.9 million.
Commenting on the results, Niels G. Stolt-Nielsen, Chief Executive Officer of Stolt-Nielsen S.A. said, "While SNSA had another tough quarter, we are encouraged by what we are seeing behind some of the reported numbers. Underlying business conditions at Stolt-Nielsen Transportation Group remain solid, despite the decline in reported results in the latest quarter. Stolt Offshore continues to make good progress with the implementation of its Blueprint for recovery, dealing appropriately with its legacy contracts and ensuring the quality of new and future business. Stolt Sea Farm continues to suffer the effects of industry-wide weakness, though there has been some evidence of strengthening prices in Europe recently."
"SNSA and Stolt Offshore have been informed by their primary lenders that they have agreed to extend the waivers granted by the lenders until November 26, 2003. Stolt Offshore continues its negotiation with its lenders to restructure Stolt Offshore's credit facilities and SNSA is negotiating with its lenders to extend or refinance SNSA's $180 million revolving credit facility, which matures in accordance with its terms on November 26, 2003. SNSA may also require amendments to its financial covenants to ensure ongoing compliance.
"Much has been written in the press in recent weeks about the legal situation in the Stolt-Nielsen Transportation Group. SNTG was granted conditional amnesty by the Department of Justice's Antitrust Division in January 2003. Although we have acknowledged the existence of uncertainty regarding the status of that amnesty, it has not been revoked. The Company's outside counsel, White and Case LLP, has told the Company that any speculation to the contrary is just that. "
"The Stolt-Nielsen Transportation Group (SNTG) reported income from operations of $21.8 million in the third quarter of 2003 compared to $36.5 million in the third quarter of 2002. Adjusted for non-recurring items (1), the comparative figures were $31.4 million in the third quarter of 2003 and $38.3 million in the third quarter of 2002. For the nine-month period in 2003, income from operations was $77.5 million and compared to $91.3 million last year. Adjusted for non-recurring items (2), the comparative figures were $94.1 million in 2003 and $99.4 million in 2002.
"SNTG's parcel tanker division reported income from operations of $17.8 million in the third quarter of 2003 compared to $25.7 million in the third quarter of 2002 and $22.5 million in the second quarter of 2003. Most of this decline can be attributed to additional legal costs, a weaker commodity market, that was offset by an exceptionally strong second quarter 2003 market for our regional fleet in Europe after a harsh winter. The Stolt Tankers Joint Service Sailed-in Index in the third quarter of 2003 was down three percent from the third quarter of 2002 but unchanged from the second quarter of 2003. We continue to rollover existing contracts of affreightment at levels broadly in line with a year ago. In recent weeks, the impact of the improving global economies has been seen with a stronger spot market and larger contract nominations.
"At SNTG's tank container division, income from operations was $4.1 million in the third quarter of 2003 compared to $6.2 million a year ago and $7.0 million in the second quarter of this year. While utilization remains at a high level and shipments are up some 15 percent on a year-to-date basis, margins were negatively impacted by pricing pressure in certain markets and higher operating costs due to the fuel surcharges, repositioning expenses and a weaker USD.
"SNTG's terminal division reported income from operations of $5.4 million in the third quarter of 2003 compared with $6.4 million in the third quarter of 2002 and $3.7 million in the second quarter of 2003. The decline from the comparable quarter of last year was the result of a late start to the alcohol season this year in Santos and weaker results in Stolthaven's joint ventures in Asia Pacific. Utilization remains strong at all locations.
"At the end of the third quarter, SNTG completed the refinancing of three 5,400 deadweight ton late 1990's built ships via a sale/leaseback raising approximately $50 million.
"Before minority interests, Stolt Offshore S.A. (SOSA) reported a net loss of $22.5 million for the third quarter of 2003 compared to a net loss of $17.2 million for the same period last year.
"Stolt Offshore has taken important steps towards settlements on legacy contracts, implemented the bulk of the changes required under the Blueprint for recovery, is actively engaged with its banks in working towards an agreement on financial restructuring and is making commercial progress in its target markets. Stolt Offshore plans to complete the worldwide implementation of the Blueprint model by November 30, 2003.
"Good progress was made on the ExxonMobil Erha project in Nigeria with 65% of the design engineering complete and early fabrication work on target. The Total Girassol Phase Two project in Angola concluded in August with excellent results with the installation and tie-in of pipelines, umbilicals and manifolds accomplished in record time. The two long-term ship charters with Petrobras in Brazil continue to produce steady revenues.
"In line with market activity across the industry, Stolt Offshore saw low order intake during the quarter, although bidding levels continue to be high. The backlog now stands at $1.2 billion, of which $334 million is for the remainder of this year. At the same point in 2002, the backlog was $1.8 billion, with $487 million for the remainder of that year. A year-on-year comparison does not reflect the improved quality of backlog or the uneven timing of contract awards inherent in the offshore construction industry.
"Three outstanding issues will impact Stolt Offshore fourth quarter results. These are the collection of receivables from the largely completed legacy contracts, the potential disposal of assets and businesses, and decisions on impairment of assets in the fourth quarter. It is because of the uncertainty surrounding these issues that Stolt Offshore indicated on September 17 that losses for the year may be substantially higher than previously indicated.
"Stolt Sea Farm Holdings plc (SSF) reported a loss from operations in the third quarter of 2003 of $18.7 million compared with income from operations of $2.3 million in the third quarter of 2002 and a loss from operations of $8.1 million in the second quarter of 2003. Salmon spot prices in the U.S. remained strong, but SSF's results in the Americas region were held down by some contract commitments and having fewer fish available on the East Coast due to last winter's super chill and poor growth in Chile. Salmon pricing in Europe was weak most of the third quarter, but in recent weeks prices have improved some 25%. In Asia, SSF's results were negatively impacted by a writedown of inventory and lower bluefin tuna prices and volumes as some of the harvest was deferred to the fourth quarter. The turbot operations in Iberia posted another solid quarter.
Looking forward, Mr. Stolt-Nielsen said, "While many challenges remain, we are upbeat about the outlook for SNTG, which will benefit from a continued strengthening of global economic conditions. SOSA is on the right track with its new management team and Blueprint. And prices appear to be moving in the right direction for SSF. We remain fully committed to working with our lenders to reach a mutually satisfactory resolution to our current financial situation."
(1) Non-recurring items in the third quarter of 2003 were: $0.2 million of restructuring charges, $4.0 million of antitrust and other investigation related legal expenses, and $5.4 million loss on the sale of Vopak and Univar shares. This compares to $1.8 million of restructuring charges in the third quarter of 2002.
(2) Non-recurring items for the nine-month period in 2003 were: $1.6 million of restructuring charges, $9.6 million of antitrust and other investigation related legal expenses, and $5.4 million loss on the sale of Vopak and Univar shares. This compares to $8.1 million of restructuring charges in the nine-month period in 2002.
About Stolt-Nielsen S.A.
Stolt-Nielsen S.A. is one of the world's leading providers of transportation services for bulk liquid chemicals, edible oils, acids, and other specialty liquids. The Company, through its parcel tanker, tank container, terminal, rail and barge services, provides integrated transportation for its customers. The Company also owns 63.5 percent of Stolt Offshore S.A. (Nasdaq:SOSA) (Oslo Stock Exchange:STO), which is a leading offshore contractor to the oil and gas industry. Stolt Offshore specializes in providing technologically sophisticated offshore and subsea engineering, flowline and pipeline lay, construction, inspection, and maintenance services. Stolt Sea Farm, wholly owned by the Company, produces and markets high quality Atlantic salmon, Salmon Trout, Turbot, Halibut, Sturgeon, Caviar, Bluefin Tuna, and Tilapia.
Forward-looking Statements
Certain statements made in this press release may include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements may be identified by the use of words like "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "project," "will," "should," "seek," and similar expressions. The forward-looking statements reflect our current views and assumptions and are subject to risks and uncertainties. The following factors, and others which are discussed in our public filings and submissions with the U.S. Securities and Exchange Commission, are among those that may cause actual and future results and trends to differ materially from our forward-looking statements: the terms, conditions and amount of our indebtedness; our ability to recover costs on significant projects; the general economic conditions and competition in the markets and businesses in which we operate; the outcome of legal proceedings; the impact of negative publicity; environmental challenges and natural conditions facing our aquaculture business; the impact of laws and regulations; uncertainties inherent in operating internationally; our relationship with significant customers; and operating hazards, including marine disasters, spills or environmental damage. Many of these factors are beyond our ability to control or predict. Given these factors, you should not place undue reliance on the forward-looking statements.
Conference Call Details:
Date & Time:
October 16th, 2003 10 am EDT (3 pm BST) Phone: +1 866 389 9773 (in U.S.) +44 1452 569 113 (outside U.S.) Reservation Number: 588162
PostView Facility
Available directly after the conference Until 5 pm EDT on Friday, October 17, 2003 Phone: +1 866 276 1167 (in U.S.) +44 1452 550 000 (outside U.S.) Reservation Number: 588162
Live Webcast conference call is available via the company's Internet site www.stolt-nielsen.com commencing on Thursday, October 16, 2003 at 10 am EDT (3 pm BST). A playback of the conference call commences on Thursday, October 16, 2003 after 12 noon EDT (5 pm BST).
The full press release with financial tables can be found at the following link: http://hugin.info/154/R/920876/124101.pdf