Viking Supply Ships AB Interim report Q2 2016

Press release
SECOND QUARTER

  · Total revenue was MSEK 298 (553)
  · EBITDA was MSEK 57 (86)
  · Result after tax was MSEK -128 (36)
  · Result after tax per share was SEK -0.7 (0.2)

YEAR TO DATE

  · Total revenue was MSEK 617 (1,062)
  · EBITDA was MSEK 124 (144)
  · Result after tax was MSEK -168 (-35)
  · Result after tax per share was SEK -0.9 (-0.2)

SUMMARY OF EVENTS IN Q2

  · With reference to the ongoing financial restructuring VSS A/S has on 12 July
signed the term sheet which had previously been agreed with the banks. In August
VSS A/S reached an agreement with the bondholders’ committee regarding a revised
proposal for restructuring of the bond issue and a bondholders’ meeting will be
summoned within short. Subject to approval of the proposal at the bondholders
meeting, this finalizes the total financial restructuring of VSS A/S.
  · EBITDA for Q2 was MSEK 57 (86).
  · The average fixture rate in Q2 was USD 51,400 (58,500) for the AHTS fleet
and USD 0 (4,100) for the PSV fleet. The average utilization in Q2 was 68% (75)
for the AHTS fleet and 0% (22) for the PSV fleet.
  · As an effect of the deteriorated market conditions within the oil & gas
industry and as a measure to further strengthen the focus on cost efficiency
within VSS A/S, the Management has decided to close the office in St. John’s,
Newfoundland with effect as of 28 April 2016.
  · In May 2016, VSS A/S agreed the main principles for a restructuring
agreement with the bank lenders. Execution of a final agreement in the form of a
term sheet (the “Agreement”) is pending certain conditions precedent, including
that an amended agreement is negotiated and agreed with the bondholders in the
senior unsecured bond in VSS A/S and that terms for the bareboat charter of Odin
Viking are re-negotiated and amended.
  · Due to the challenging market conditions, VSS A/S has recognized an
impairment loss during Q2 2016 of MSEK 145 related to the PSV fleet.
  · TA AB has sold the two small bulk vessels TransAndromeda and TransCapricorn.
The transaction, which was concluded in May 2016, brought positive cash effect
of MSEK 24.
  · After a short temporary leave Christian W. Berg is back in his position as
CEO of Viking Supply Ships A/S.

SUBSEQUENT EVENTS

  · VSS A/S has received an early termination notice of the contract for the Ice
-class 1A AHTS vessel Njord Viking. The vessel has been working for Eni Norge in
the Barents Sea and has also been part of the extended towing-preparedness in
the area on behalf of the Norwegian Coastal Administration. The vessel was
according to the contract with Eni Norge firm until the end of 2016, with
optional periods of 2 x 6 months thereafter. According to the contract VSS A/S
will be entitled to a termination fee of approximately USD 13.300/day for the
remainder of the firm period. The termination represents a loss of income during
the remaining firm period of the contract of MUSD 3.3 in 2016. VSS A/S will off
-set this loss by marketing the vessel in the North Sea spot market, while also
searching for alternative contracts for the vessel.