Link to the complete 1st Quarter 2018 report:
http://hugin.info/159489/R/2192775/849087.pdf
Hamilton, Bermuda, May 15, 2018.
Nordic American Offshore Ltd ("NAO" or the
"Company") owns and operates a fleet of 10 Platform Supply Vessels
(PSV) each averaging approximately 4,000 DWT and with an average
age of about 4 years. The vessels are primarily engaged in the
North Sea offshore market.
During 1Q2018, encouraged by improved market
conditions, we decided to mobilize the three laid-up vessels and to
restore our operational fleet to full capacity. Two of the three
vessels are now joining our active fleet. We wish to see a more
sustainable market before we activate our last ship which is ready
for classification.
We remain moderately optimistic for the North
Sea market and we have seen a healthy number of term fixtures in
the market place. Having an attractive fleet, with 9 of our 10
vessels fully operational, improved market conditions should allow
for immediate improvement in our financial results.
Results for the first quarter 2018 came in lower
compared with fourth quarter 2017. The Net Operating Loss was
-$8.4m for 1Q2018 as compared with -$7.1m for 4Q2017 (accounting
numbers). The Adjusted Net Operating Result[1] was -$4.1m
(cash loss) as compared to -$2.8m for 4Q2017.
The basic features of NAO are similar to the
business model of the NYSE listed tanker company Nordic American
Tankers Limited ("NAT"). NAT holds 16.1% of NAO's common shares.
The Executive Chairman of NAO and his
immediate family hold 13.4% of NAO's common shares. He is
also the Chairman & CEO of NAT.
The Board of Directors of NAO has declared a
dividend of $0.01 per share for 1Q2018 to shareholders of record as
of May 25, 2018. The payment of the dividend is expected to
take place on or about June 8, 2018. Since its establishment in
late 2013, NAO has paid dividends for 17 consecutive quarters,
totaling $2.68 per share, including the dividend to be paid June 8,
2018.
NAO pursues a conservative financial policy. At
the end of 1Q2018, the net debt[2] per vessel was $10.9
million.
We concentrate on keeping our vessel operating
costs low, while always maintaining our strong commitment to safe
operations. As we expand our fleet, we do not anticipate that our
administrative costs will rise correspondingly.
For further details on our financial position,
please see the financial information reported below and this entire
release.
Strategy Going Forward
The main elements of NAO's strategy are based on
quarterly dividends, low G&A costs and liquidity in the
stock. NAO has about 35,000 shareholders.
We seek to achieve a competitive cash yield and
Total Return[3], a precise measure of value creation.
NAO is committed to protecting its underlying
earnings, dividend potential and strong balance sheet. We shall
endeavor to safeguard and further strengthen NAO's position in a
deliberate, predictable and transparent way.We encourage investors
interested in the offshore sector to consider buying shares in
NAO.
Link to the graph:
http://hugin.info/159489/R/2192775/849087.pdf
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
Matters discussed in this press release may
constitute forward-looking statements. The Private Securities
Litigation Reform Act of 1995 provides safe harbor protections for
forward-looking statements in order to encourage companies to
provide prospective information about their business.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements, which are other than
statements of historical facts.
The Company desires to take advantage of the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995 and is including this cautionary statement in
connection with this safe harbor legislation. The words "believe,"
"anticipate," "intend," "estimate," "forecast," "project," "plan,"
"potential," "may," "should," "expect," "pending" and similar
expressions identify forward-looking statements.
The forward-looking statements in this press
release are based upon various assumptions, many of which are
based, in turn, upon further assumptions, including without
limitation, our management's examination of historical operating
trends, data contained in our records and other data available from
third parties. Although we believe that these assumptions
were reasonable when made, because these assumptions are inherently
subject to significant uncertainties and contingencies which are
difficult or impossible to predict and are beyond our control, we
cannot assure you that we will achieve or accomplish these
expectations, beliefs or projections. We undertake no
obligation to update any forward-looking statement, whether as a
result of new information, future events or otherwise.
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 world economies
and currencies, general market conditions, including fluctuations
in charter rates and vessel values, changes in demand in the PSV
market, as a result of changes in the general market conditions of
the oil and natural gas industry which influence charter hire rates
and vessel values, demand in platform supply vessels, our operating
expenses, including bunker prices, dry docking and insurance
costs, governmental rules and regulations or actions taken by
regulatory authorities as well as potential liability from pending
or future litigation, general domestic and international political
conditions, potential disruption of shipping routes due to
accidents or political events, the availability of financing and
refinancing, vessel breakdowns and instances of off-hire and other
important factors described from time to time in the reports filed
by the Company with the Securities and Exchange Commission.
Contacts:Gary J. Wolfe Seward & Kissel LLP New York,
USA Tel: +1 212 574 1223 Marianne Lie, Executive Vice Chair Nordic
American Offshore Ltd. Tel.: +47 91 64 55 06 Bjørn Giæver, CFO
Nordic American Tankers Limited Tel: +1 888 755 8391 or
+47 91 35 00 91 Herbjørn Hansson, Executive Chairman Nordic
American Offshore Ltd. Tel: +1 866 805 9504 or +47 90 14 62 91
Web-site: www.nao.bm
[1] Adjusted Net Operating Result represents Net Operating
Result before depreciation and non-cash administrative.
charges.
[2] Net debt is working capital less long term debt divided by
10 vessels.
[3] Total Return is defined as stock price plus dividends,
assuming dividends are reinvested in the stock.
- 1st Quarter 2018 Result.pdf
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