TORM plc interim results for the half year ended 30 June 2018
August 16 2018 - 2:54AM
TORM plc interim results for the half year ended 30 June 2018
“Despite healthy end-user consumption, the product tanker market
remained under pressure in the second quarter of 2018.
Nevertheless, I am pleased to see TORM outperformed commercially
when comparing to relevant benchmarks and peers,” says Executive
Director Jacob Meldgaard and continues: “We have continued to take
steps to further renew and optimize our fleet by taking delivery of
one LR2 newbuilding in the second quarter and exercising
newbuilding options for three MR vessels. In addition, we have to
date decided to install scrubbers on 14 of our vessels to prepare
for the expected consequences of the IMO sulfur emission directive
that will come into force in 2020.”
- EBITDA for the second quarter of 2018 was USD 29.4m (2017, same
period: USD 35.7m). The loss before tax amounted to USD 8.6m (2017,
same period: USD -1.5m). Cash flow from operating activities was
positive with USD 25.1m in the second quarter of 2018 (2017, same
period: USD 38.5m) and loss per share (EPS) was 12 cents (2017,
same period: -3 cents). Return on Invested Capital (RoIC) was 0.1%
(2017, same period: 2.1%).
- EBITDA for the half year ended 30 June 2018 was USD 66.7m
(2017, same period: USD 79.8m). The result before tax for the first
six months of 2018 was a loss of USD 7.5m (2017, same period:
profit of USD 3.3m). Cash flow from operating activities was
positive with USD 43.0m in the first six months of 2018 (2017, same
period: USD 65.3m) and loss per share (EPS) was 12 cents (2017,
same period: 5 cents). Return on Invested Capital (RoIC) was 1.2%
(2017, same period: 3.0%).
- In the second quarter of 2018, TORM achieved TCE rates of
USD/day 12,944 (2017, same period: USD/day 13,841). In the second
quarter of 2018, product tanker freight rates started out at levels
close to the levels seen in the first quarter of 2018, but the
rates started to slide towards the end of the quarter.
- As of 30 June 2018, 15% of the remaining total earning days in
2018 were covered at an average rate of USD/day 16,323. As of 7
August 2018, 55% of the remaining total earning days in Q3 2018
were covered at USD/day 11,856.
- TORM has decided to install scrubbers on 14 vessels including
all vessels currently on order and the three LR2 vessels that were
delivered earlier in 2018. These vessels have a scrubber-prepared
design and there are no changes to the delivery schedule. As of
today, TORM’s scrubber program covers four LR2s, two LR1s and eight
MRs.
- In early April 2018, TORM exercised newbuilding options for
three MR vessels for a total net consideration of USD 93m of which
USD 63m is financed by banks. The three vessels are scheduled to be
delivered in 2019 through the first quarter of 2020.
- TORM took delivery of two LR2 newbuildings in the first quarter
of 2018 and on 20 April 2018 a third newbuilding, TORM Hellerup,
was delivered. In June 2018, TORM redelivered the chartered LR2
vessel TORM Margrethe to its owner after expiry of the charter
period. As of 30 June 2018, TORM’s fleet consists of 74 owned
vessels, four chartered-in vessels and ten vessels on
order.
- As of 30 June 2018, TORM’s available liquidity was USD 442m and
consisted of USD 159m in cash and USD 283m in undrawn credit
facilities. As of 30 June 2018, net interest-bearing debt amounted
to USD 598m. As of 30 June 2018, TORM's net loan-to-value (LTV)
ratio was 54%.
- Based on broker valuations as of 30 June 2018, TORM’s Net Asset
Value (NAV) excluding charter commitments was estimated at USD
840.3m. This corresponds to a NAV/share of USD 11.4 or DKK 72.
TORM’s book equity amounted to USD 882m as of 30 June 2018. This
corresponds to a book equity/share of USD 11.9 or DKK
76.3.
- Based on broker valuations, TORM’s fleet including newbuildings
had a market value of USD 1,675m as of 30 June 2018. Compared to
the broker valuations as of 31 March 2018, the fleet value has
increased by USD 75m. Of the USD 1,675m, the value of new vessel
contracts entered into in Q2 2018 summarized to USD 111m. Compared
with Q1 2018, the broker value of the comparable fleet has
decreased by USD 36m, totaling a net increase of USD
75m.
- As of 30 June 2018, TORM’s order book stood at ten
newbuildings: one LR2, two LR1s and seven MRs, all from Guangzhou
Shipyard International, China. The LR2 vessel is expected to be
delivered in the third quarter of 2018 and the LR1s and the MRs in
2019 through the first quarter of 2020.
- The book value of the fleet was USD 1,450m as of 30 June 2018
excluding outstanding installments on the newbuildings of USD
306m.
CONFERENCE CALLTORM will be hosting a
conference call for investors and financial analysts at 3 pm CET (9
am EST) today, 16 August 2018. Please dial in 10 minutes before the
conference is due to start on +45 8071 8097 (from Europe) or +1 866
966 1396 (from the USA). Conference ID: 3498788. The presentation
can be downloaded from www.torm.com.
CONTACT Jacob Meldgaard, Executive Director,
tel.: +45 3917 9200Christian Søgaard-Christensen, CFO,
tel.: +45 3917 9200.: |
TORM
plcBirchin Court, 20 Birchin LaneLondon EC3V 9DU, United
KingdomTel.: +45 3917 9200 / Fax: +45 3917 9393
www.torm-plc.com |
ABOUT TORM
TORM is one of the world’s leading carriers of refined oil
products. The Company operates a fleet of approximately 80 modern
vessels with a strong commitment to safety, environmental
responsibility and customer service. TORM was founded in 1889. The
Company conducts business worldwide. TORM’s shares are listed on
NASDAQ Copenhagen and NASDAQ New York (tickers: TRMD A and TRMD).
For further information, please visit www.torm.com.
SAFE HARBOR STATEMENTS AS TO THE FUTUREMatters
discussed in this release may constitute forward-looking
statements. Forward-looking statements reflect our current views
with respect to future events and financial performance and may
include statements concerning plans, objectives, goals, strategies,
future events or performance, and underlying assumptions and
statements other than statements of historical facts. The words
“believe,” “anticipate,” “intend,” “estimate,” “forecast,”
“project,” “plan,” “potential,” “may,” “should,” “expect,”
“pending” and similar expressions generally identify
forward-looking statements.
The forward-looking statements in this release are based upon
various assumptions, many of which are based, in turn, upon further
assumptions, including without limitation, management’s examination
of historical operating trends, data contained in our records and
other data available from third parties. Although the Company
believes that these assumptions were reasonable when made, because
these assumptions are inherently subject to significant
uncertainties and contingencies that are difficult or impossible to
predict and are beyond our control, the Company cannot guarantee
that it will achieve or accomplish these expectations, beliefs or
projections.
Important factors that, in our view, could cause actual results
to differ materially from those discussed in the forward-looking
statements include the strength of the world economy and
currencies, changes in charter hire rates and vessel values,
changes in demand for “ton miles” of oil carried by oil tankers,
the effect of changes in OPEC’s petroleum production levels and
worldwide oil consumption and storage, changes in demand that may
affect attitudes of time charterers to scheduled and unscheduled
dry-docking, changes in TORM’s operating expenses, including bunker
prices, dry-docking and insurance costs, changes in the regulation
of shipping operations, including requirements for double hull
tankers or actions taken by regulatory authorities, potential
liability from pending or future litigation, domestic and
international political conditions, potential disruption of
shipping routes due to accidents, political events or acts by
terrorists.
In light of these risks and uncertainties, you should not place
undue reliance on forward-looking statements contained in this
release because they are statements about events that are not
certain to occur as described or at all. These forward-looking
statements are not guarantees of our future performance, and actual
results and future developments may vary materially from those
projected in the forward-looking statements.
Except to the extent required by applicable law or regulation,
the Company undertakes no obligation to release publicly any
revisions to these forward-looking statements to reflect events or
circumstances after the date of this release or to reflect the
occurrence of unanticipated events.
- 14-2018 - TORM plc H1 2018 results - UK
- TORM plc H1 2018
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