• 2018 March 19 17:22

    Gross revenue of Sovcomflot in 2017 grew by 3.4% to $1.43 billion

    PAO Sovcomflot (SCF Group), one of the world leaders in energy shipping and marine services to offshore oil and gas upstream projects, has today reported its results for the full year to 31 December 2017.

    2017 Full Year Financial Highlights

    (IFRS audited accounts – year to 31 December 2017)

    USD Millions

     

    2017

     

    2016

    % ∆

    Gross revenue (Freight + hire)

    1,435.4

    1,388.1

    +3.4

    Time charter equivalent revenue*

    1,058.0

    1,142.2

    (7.4)

    EBITDA**

    544.9

    695.0

    (21.4)

    Adjusted (loss)/profit***

    10.1

    263.0

    (96.2)

    Net (loss)/profit

    (113.0)

    206.8

    -

    According to the statement, 2017 proved to be one of the worst years for the conventional tanker market in the last quarter of a century, with similar conditions experienced to those seen in 2011 and 1992. Conventional tanker freight rates fell by almost 50 per cent year-on-year, reflecting an oversupply of speculative orders following the 2015 market spike, as well as the effect of sustained production cuts by OPEC and other oil producing nations and a backwardation in the oil trade. Set against this background, the Group’s time charter equivalent revenue declined by only 7.4 per cent, demonstrating the robust nature of its industrial-focused business model.

    Over 2017, the Group continued to implement its strategy to expand the fixed income, industrial shipping segments of its business with Offshore Services and Gas Transportation increasing their revenues by 48.7 per cent and 17.4 per cent respectively. The total share of Group revenue from industrial shipping activities amounted to 51 per cent of its revenue base in 2017, enabling the Group to achieve a positive operating profit for the year.

    In line with IFRS accounting standards, the Group recorded a non-monetary charge of USD 108 million in total, reflecting impairment of the fleet and non-operating costs regarding litigation in the English courts, relating to various transactions that took place during 2000 - 2004.

    Profit before tax, when adjusted for the impairment reserve of the fleet and non-operating costs, amounted to USD 10.1 million in 2017, signifying that the Group remained profitable at an operating level despite the severe market conditions affecting its conventional fleet.

    Sergey Frank, President and CEO of Sovcomflot commented:

    “Despite the very strong headwinds seen in the conventional tanker markets over 2017, with freight rates down by almost 50 per cent reflecting one of the worst years in a quarter of a century, we continued to implement our core strategy of industrialising our business model. Sovcomflot’s growing industrial portfolio (offshore services and gas transportation) enabled us to remain profitable operationally. Our Offshore and Gas businesses saw time charter equivalent revenues increasing by 48.7 and 17.4 per cent respectively year-on-year, providing a welcome relief from the difficult conditions facing our conventional tankers. The robust nature of the Group’s business model has shown our ability to weather the low point of the shipping cycle”.

    “In such a challenging year, I am especially grateful to all my colleagues at sea and ashore for their continued professionalism and dedication, and to our clients and partners around the world for their valued support. It’s especially important that, in this extremely challenging year, we continued our commitment to innovation by delivering to our clients some of the most advanced vessels ever constructed, which will contribute to their upstream projects and address some unique operational challenges in the harsh environments. Further, we achieved a significant milestone with the decision to power with LNG our new generation of ice class Aframax tankers, setting new standards for emissions and making the tanker industry greener”.

    Evgeniy Ambrosov, Senior Executive Vice-President of Sovcomflot, commented:

    “Last year we have delivered several pioneering new vessels, designed in close cooperation with our esteemed strategic charterers, which are destined to become one of the core elements of a unique logistics system for the transportation of hydrocarbons. One such example being the icebreaking LNG carrier Christophe de Margerie, purpose built to make LNG exports possible from the vast Arctic energy reserves of the Yamal Project in Northern Russia. The newest logistical and technical solutions have been tested by us from the beginning of this century on various successfully operating projects. Elsewhere, three highly sophisticated icebreaking platform supply vessels (IBSVs) were delivered during the year to serve the Sakhalin-2 Project, continuing our well-established long-term partnership with Sakhalin Energy Investment Company. Another state-of-the art Arctic shuttle tanker for the Novy Port project was delivered to the charterer Gazpromneft.”

    Igor Tonkovidov, Executive Vice-President and Chief Operating / Chief Technical Officer of Sovcomflot said:

    Sovcomflot’s stays commited to shipping innovations which were further enhanced in 2017, with the Group taking the lead amongst tanker owners in delivering a cleaner and safer marine environment. We were delighted to sign an agreement with Shell for the supply of LNG to fuel a new generation of Aframax tankers. These so-called ‘Green Funnel’ vessels are being pioneered by Sovcomflot and our shipbuilding partners in Russia and South Korea. In 2017 we ordered six such tankers, for delivery between Q3 2018 and Q1 2019. These vessels were designed to exceed, rather than simply comply with, emissions legislation”.

    Nikolay Kolesnikov, Executive Vice-President, Chief Financial Officer of Sovcomflot, commented:

    “During 2017 we completed a series of financing deals amounting to USD 367 million in total, including a USD 150 million tap Eurobond issue, which was well oversubscribed and placed at one of the lowest yields for a global shipping company. Our ability to access competitively-priced domestic and international capital in all market conditions reflects the resilience of Sovcomflot’s industrial shipping model, which provides good earnings stability and visibility. At the end of the year, we had USD 8.1 billion of contracted future revenues, a major part of which comes from long-term industrial projects. The Group has maintained its credit ratings with all the three main international rating agencies in 2017 and into the current financial year.”

    PAO Sovcomflot (SCF Group) is Russia’s largest shipping company and a world leader in the transportation of hydrocarbons by sea, as well the servicing of offshore oil and gas exploration and production. The company’s owned and chartered fleet includes 150 vessels with a total deadweight of more than 13.1 million tonnes. Half of the vessels have an ice class. Sovcomflot is involved in servicing large oil and gas projects in Russia and around the world: Sakhalin-1, Sakhalin-2, Varandey, Prirazlomnoye, Novy Port, Yamal LNG, and Tangguh (Indonesia).

    The company is headquartered in Saint Petersburg, with offices in Moscow, Novorossiysk, Murmansk, Vladivostok, Yuzhno-Sakhalinsk, London, Limassol, and Dubai.

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2018 December 12

19:08 Hapag-Lloyd announces General Rate Increase from East Asia to USA and Canada
18:30 MEYER WERFT handed over AIDAnova to AIDA Cruises
18:21 IMO led panel discussion on wreck removal challenges at Salvage & Wreck Removal Conference in London
18:00 Rosneft develops innovations for Russian Zvezda super-shipyard
18:00 Newbuilding methanol carrier for Proman Shipping named CASTARA
17:46 Damen signs with Port Nelson for ASD Tug 2411
17:37 Almaz shipyard lays down icebreaker of Project 21180М, Yevpaty Kolovrat, for RF Navy
17:14 Comprehensive plan for NSR development to be ready by February 2019 – Yevgeny Ditrikh
16:49 Investments in the Arctic by 2024 estimated at RUB 5.5 trillion - Dmity Kobylkin
16:23 Vladimir Putin orders to look into creation of port SEZ at Olya port in Arkhangelsk Region
15:50 Throughput of Russian seaports in 11M’18 grew by 4.2% Y-o-Y to 746.8 million tonnes (detalization)
15:26 Okskaya Sudoverf launches first dry cargo carrier of Project RSD32M
15:02 American Petroleum Institute (API) awards bolt fatigue testing program contract to DNV GL
14:25 Giant Octopus added to the CPC’s stock of ER equipment
14:01 London hosts global port environment experts
13:20 Pola Anatolia, dry cargo ship of RSD59 design, successfully passed sea trials
13:01 Newcastle Container Terminal to deliver savings for regional NSW
12:36 Sovcomflot BoD considered the Group’s financial plan for 2019 and a forecast for 2020-2021
12:01 Diana Shipping announces time charter contract for m/v Ismene with Koch
11:49 Yury Trutnev appointed as head of revised State Commission for Arctic Development
11:22 Three icebreaker escort operations performed in eastern part of Gulf of Finland during 24 hours on December 11-12
11:00 COSCO SHIPPING Ports partners with Abu Dhabi Ports to create regional trading hub and Middle East gateway for Belt and Road
10:47 Throughput of Rostov-on-Don port in 11M’18 up 15% Y-o-Y to 22.9 million tonnes
10:20 Brent Crude futures price up 1.16% to $60.9, Light Sweet Crude – up 0.67% to $52.3
10:11 Full bonded area is opened in Port Bronka
10:01 WMU welcomes ITF General Secretary and President
09:59 GTT receives an order for the tank design of two new LNG carriers
09:44 Bunker prices continue going down at the Port of Saint-Petersburg, Russia (graph)
09:16 Baltic Dry Index is down to 1,364 points
08:28 Boskalis Ndurance’ cable trencher successfully tested at Alexiahaven
08:05 Maritime Blockchain Labs announces new consortium to improve crew management

2018 December 11

17:59 ASW Severomorsk of RF Navy's Northern Fleet makes a call to the Republic of Djibouti
17:33 Diesel submarine of RF Navy’s Pacific Fleet conducted training exercise in the Sea of Japan
17:10 Port of Antwerp International to consult USPA on tariff setting, concession and environmental policy
16:46 Van Oord supports the 6th Forum of Dredging Companies as its Sponsor
16:21 Yamal LNG reached full capacity
16:02 Hapag-Lloyd announces rates from Indian Subcontinent & Pakistan to North Europe
15:32 Georgia Ports Authority on track for 4.3M TEUs in 2018
15:20 Four new sponsors confirmed to join line-up at 2019’s Maritime Reconnaissance and Surveillance Technology conference
15:02 Hapag-Lloyd announces rates from Middle East to North Europe
14:48 Draft law on Arctic administration approved in the third reading by Russia’s State Duma
14:32 ECSA welcomes the decision by the EU Commission to update the EU list of ship recycling facilities
14:02 Global Ship Lease announces new long-term charter agreements with CMA CGM
13:32 Maersk Broker Bulk Chartering and Wonsild Dry to merge as of January 2019
13:15 Throughput of port Kavkaz in 11M’18 grew by 13% Y-o-Y to 45.61 million tonnes
13:02 COSCO SHIPPING Ports and Abu Dhabi Ports inaugurate CSP Abu Dhabi Terminal
12:46 Throughput of Russian seaports in 11M’18 grew by 4.2% to 746.81 million tonnes
12:13 Alfa Laval sells more than 100 GCU units for LNG newbuilds
12:01 Overseas Shipholding Group and American Shipping Company jointly announce extension of tanker charters
11:44 One icebreaker escort operation performed in eastern part of Gulf of Finland during 24 hours on December 10-11
11:40 The second phase of IMO-implemented safe and sustainable ship recycling project in Bangladesh starts
11:17 Bunker prices are flat at the Far East ports of Russia (graph)
10:58 NYK сoncludes long-term charter agreement for three LNG carriers with MC
10:30 MAN Cryo and partners develop marine liquid-hydrogen fuel-gas system
10:05 Port of Gdansk reports new quarterly record
09:39 Brent Crude futures price up 0.37% to $60.19, Light Sweet Crude – up 0.31% to $51.16
09:16 Baltic Dry Index is up to 1,385 points

2018 December 10

18:08 US major retail container ports imports reach 2 million containers in October 2018
17:50 Taganrog Sea Commercial Port spent USD 67,300 for its environmental programme in 9M’2018, up 6% YoY
17:27 Icebreakers of FSUE Rosmorport assisted 322 ships in navigation season 2018-2019