RESULTS
Odfjell's consolidated net result was USD 17 million in the first quarter of 2001. The improvement from a loss of USD 7 million in the first quarter of 2000 reflects a stronger market for transporting chemicals and particularly for the clean petroleum products market. Earnings before interest, tax, depreciation and amortisation (EBITDA) for the quarter were USD 51 million, a sharp increase from USD 19 million for the comparable 2000 period. Operating result (EBIT) for the quarter was USD 35 million, compared with USD 4 million for the first quarter of 2000. Gain from sale of 50% of the vessel Bow Saphir to the joint-venture company, Odfjell y Vapores, Chile, is included in the figures for the first quarter of 2001 with USD 3.5 million.
The result before currency items and taxes for the first quarter of 2001 was USD 23 million, compared to a loss of USD 5 million in the first quarter of 2000, a loss of USD 4 million in the second quarter of 2000, break-even result in the third quarter of 2000 and profit of USD 6 million in the fourth quarter of 2000.
Gross revenue for the first quarter of 2001 was USD 220 million compared to USD 142 million in the first quarter of 2000.
The increase in total operating cost compared to the corresponding period in 2000 reflects the inclusion of nine Seachem vessels acquired during the summer of 2000. General and Administrative expenses as well as depreciation are higher than in 2000 due to the growth of our business.
Net interest expenses for the first quarter of 2001 was USD 12 million compared to USD 9 million for the same period in 2000 and USD 13 million in the fourth quarter of 2000.
The average USD/NOK exchange rate was 8.85 (8.22). The strengthening of the USD/NOK rate from 8.90 at year-end 2000 to 9.12 at 30 March 2001 negatively impacted our currency hedging portfolio and our cash position in NOK, resulting in a cost of USD 5 million (USD 2 million).
BUSINESS SEGMENTS
Global trade
EBITDA, including sales gain of USD 3.5 million, for the first quarter of 2001 was USD 42.3 million, an increase from USD 13.1 million in the first quarter of 2000. Operating profit (EBIT) from USD 1.3 million in the first quarter of 2000 to USD 27.6 million in the first quarter of 2001. Freight rate improvements resulted in time-charter income expressed in USD per day for our fleet in global trade increased by more than 50% compared to the first quarter of 2000. The corresponding change was 27% compared to fourth quarter last year. The bunker costs were about USD 128 per ton, still high but somewhat lower than the USD 149 per ton for the same period last year. Operating cost on a comparable fleet basis was about 2.5% lower than the same period in 2000.
Regional trade
EBITDA for the first quarter of 2001 was USD 3.7 million, an increase from USD 2.2 million in the first quarter of 2000. The regional trade in Asia has shown improvements during the quarter and accounts for most of the improvement since last year. The regional sailings along the west coast of South-America continue to perform well. Odfjell Americas is still experiencing lower demand for inter-Caribbean transportation services.
Tank terminals
EBITDA for the first quarter of 2001 was USD 8.9 million, which is more than double the first quarter of 2000 figure of USD 4.0 million. The EBITDA of Odfjell Terminals (Baytank) was USD 3.7 million, compared with USD 3.8 million in the first quarter of 2000. Odfjell Terminals (Rotterdam) that was acquired in June 2000 showed an EBITDA of USD 5.0 million for the first quarter of 2001. The two terminals in China made an EBITDA of USD 0.2 million.
Tank containers
EBITDA for the first quarter of 2001 was break-even, compared to negative USD 0.3 million in the first quarter of 2000. Hoyer-Odfjell is still impacted by difficult market conditions and the fact that the company is still in a build-up phase.
LIQUIDITY AND FINANCING
Liquid assets as of 31 March 2001 was USD 206 million compared to USD 227 million as of 31 December 2000.
Interest bearing debt decreased from USD 954 million as per year-end 2000 to USD 911 million per 30 March 2001.
SHAREHOLDER INFORMATION
During first quarter of 2001 the price of the Odfjell A-share fell by 4%, from NOK 135 to NOK 130. The B-share declined from NOK 120 to NOK 110, a decrease of 8%. The Oslo Stock Exchange shipping index increased by 2%, and the new transportation index rose by 10% during the first quarter of 2001.
Earnings per share amounted to USD 0.66 (NOK 6.02) in the first quarter of 2001 compared to negative USD 0.34 (negative NOK 2.79) in first quarter 2000.
Cash flow per share was USD 1.43 (NOK 13.04) compared to USD 0.35 (NOK 2.88).
So far in 2001 we have through our stock repurchase program acquired 284,850 A-shares at an average price of NOK 121.21 per share and 165,300 B-shares at an average price of NOK 115.74 per share. The total number of repurchased shares, 558,850 A-shares and 806,900 B-shares, totalling 1,365,750 shares as per 8 May 2001, was approved redeemed at the Annual General Meeting held yesterday, 8 May 2001. As a consequence of this redemption, the company has 17,668,871 A-shares and 7,740,625 B-shares outstanding. At the Annual General Meeting on 8 May 2001 the Board of Directors was given an authorisation to acquire up to 10% of the outstanding shares of the company. All other items of the agenda to the Annual General Meeting dated 6 April 2001 were also approved.
PROSPECTS FOR 2001
We expect the present market environment to continue throughout 2001. This is due to reduced supply of new tonnage combined with a continuous growth in demand. The company is still benefiting from a good market for clean petroleum tonnage. During the last six months a number of freight contracts were renewed at substantially higher rates.
One of the major risk factors is a further weakening of the US economy, and its impact on world chemical movements. Cost of bunker and USD interest rates are expected to be lower in year 2001 compared to year 2000.
Through the merger with Seachem and the acquisition of Odfjell Terminals (Rotterdam) the company has significantly strengthened its market position as a total logistics service provider.
Bergen, 9 May 2001
The Board of Directors of Odfjell ASA
Odfjell is the leading player in the global market of transporting chemicals and related logistical services. The fleet totals 85 vessels, trading both globally and regionally, of which 49 are owned by the group. Odfjell additionally owns and operates tank terminals and tank containers. Priority is being given to further developing the company's integrated logistical services.
