TTS Group announces results for Q2 2015
TTS Group achieved an operating profit (EBITDA) of MNOK 137.8 in Q2 2015, consisting of an operational profit of MNOK 34.2, and a one-off effect of MNOK 103.7 that relates to the acquisition of control of the jointly owned Chinese company TTS Hua Hai. – The stable good results within the services and car carrier segments, together with the reduced losses in offshore and heavy lift segments, are contributing to the positive result, says Björn Andersson, CEO of TTS Group ASA.
In accordance with applicable accounting regulations, as of Q2 2015 TTS runs from joint control to full control of the jointly owned Chinese company TTS Hua Hai. This follows amendments to the agreements that governing the control of the company. A technical valuation in relation to the control transition provides a positive one-off effect of MNOK 103.7 for TTS Group EBITDA in Q2. TTS Hua Hai is consolidated 100% in TTS Groups accounting from Q2 2015 and thereby also contributes with a positive EBITDA effect of MNOK 19.6 for the same quarter.
- If we look solely at TTS Groups 100% owned companies, we also record a significant profitability improvement in Q2, with an EBITDA of MNOK 14.6; up MNOK 24.9 from the same period in 2014. This confirms that the restructuring measures in 2014 and the ongoing cost reduction program have had effect. At the same time we certainly could have wished for better benefit from the market in certain segments, says Andersson.
Besides TTS Hua Hai, the two business units RoRo / Cruise / Navy and Services are the most important contributors to a positive operating result, with EBITDA respectively MNOK 16.2 and MNOK 19.7 million. The reduced losses in the business unit Offshore, together with a break even result from business unit Multipurpose / General Cargo which had a loss at the same period in Q2 2014, have also contributed to the profit growth.
TTS Groups total revenues in Q2 were MNOK 816, including a turnover of MNOK 261 in TTS Hua Hai. For TTS Group 100% -owned companies, revenue went down slightly compared to Q2 2014.
This only emphasizes the importance of the accumulation and development of business that we are now conducting with full force in China, the world's largest shipbuilding nation, says Andersson.
The total order backlog at the end of Q2 2015, including TTS Hua Hai and 100% of the joint ventures in China, was NOK 4 477, compared to MNOK 4 215 at the same time in 2014.