TCE revenues increased by 34.1% to $270.6 mill and EBITDA increased 65.7%t to $153.6 mill, while net profit reached $58.1 mill in 1Q14, compared to $2 mill in 1Q13.
There was significant growth in the crude oil transportation segment, SCF said, with TCE revenues increasing by 56.1% to $134.7 mill.
The first quarter of this year marked the entry into service of the VLCC ‘SCF Shanghai’ (321,280 dwt), which is engaged on a long-term timecharter to PetroChina International (a subsidiary of China National Petroleum Corp)
Commenting on the Group’s results Sergey Frank, SCF group president and CEO, said: “Following five years of recession, the tanker market is showing the early signs of a long overdue recovery.Throughout the down-cycle, Sovcomflot’s robust business model has continued to deliver. Our balanced chartering policy while being conservative enough makes us well positioned for the upswing in the market.
“By focusing on servicing the transportation needs of our core clients and on large-scale industrial projects, in the hydrocarbons sector, we have benefited from better vessel utilisation and long-term contracted revenues. The Group’s future contracted revenues of $6.7 bill provide welcome protection against volatility in the tanker markets and a solid basis for the further growth of our business.
“During the first quarter of 2014 we continued to implement the Group’s development strategy. This is designed to ensure that we continue to use state-of-the-art technologies across our fleet, in order to serve the evolving needs of our clients. Specifically, we aim to provide safe and reliable transportation for the developing oil and gas fields in the Arctic and sub-Arctic regions,” he said.
Total assets at 31st March, 2014 totalled $6,562.5 mill (31st March 2013= $6,408.0 mill). SCF maintained stable net debt ratios throughout the period, with a slight overall decline in gearing (leverage) at the quarter end to 45.8% (31 March 2013= 46.3%).
The Group’s cash position as at the end of 1Q14 was $335.7 mill (31st March 2013= $179.6 mill), reflecting the improved performance from the crude oil transportation segment and also a number of vessel sales.
The TCE revenue increase in the crude oil segment during 1Q14 reflected stronger underlying dynamics in the crude oil transportation segment in general and a firming of daily timecharter rates, which began in 3Q13 and continued throughout 1Q14.
In contrast to the crude oil market, conditions in the products segment were less favourable with operating margins remaining under significant pressure. Against this background, TCE revenues increased by 1.9% to $53.1 mill during the first quarter, compared with the same period in 2013.
SCF’s gas segment TCE revenues increased by 81.8% to $20.7 mill in 1Q14, compared with 1Q13. On 2nd February, 2014, Sovcomflot took delivery of ‘Velikiy Novgorod’, a 170,000 cu m capacity LNGC, which was built to ice class Ice2 and is engaged on a 15- year timecharter to Gazprom.
SCF said that its corporate strategy priority is on the development of its LNG transportation activities. To this end, there were four LNGCs on order at the end of 1Q14, each of over 170,000 cu m capacity, for delivery up to 1Q16. All the vessels have long-term timecharter arrangements in place with Gazprom, Shell, or Yamal LNG.
As at 31st March 2014, SCF Group’s fleet comprised 158 vessels (including vessels in joint ownership with third parties) with a combined deadweight of over 12 mill tonnes. These included 134 owned vessels; two chartered-in vessels; nine escort tugs, which have been chartered-out on bareboat charter to an associate company – Rosnefteflot; as well as four LNGCs and nine LR1s in joint-venture companies.
Four vessels, with a total deadweight of 477,600 tonnes, were on order. These included - three LNGCs (Ice-class Ice2, 170,000 cu m capacity) and an Arctic LNGC (Ice class Arc7, 172,000 cu m capacity).