Exmar angles for contracts

Exmar has reported turnover of $453.7m in its preliminary results for 2011, up 9.6 per cent on the $413.9m recorded a year earlier. EBITDA fell, however, from $176.9m in 2010 to $139.9m. Exmar made a consolidated net loss of $45.4m compared to a profit of $14.4m in 2010.

The operating profit of $37.3m was also well down on the 2010 figure of $87.4m. LPG operations fell into the red as a weak market persisted through most of the year. EBIT from LNG operations was also well down, despite high charter rates. The group was supported by a turnaround in contributions from its offshore division.

The LPG operating loss of $19.5m was caused largely by a book loss of $26.7m on the sale of the two 85,000 m³ VLGCs Flanders Liberty and Flanders Loyalty to BW Gas, with a book profit of $4.0m on the sale of the 25,000 m³ Gent not enough to compensate. Exmar’s midsize segment continued to be supported by long-term charter coverage and by end-January 2012 it had achieved 70 per cent coverage for this year at good rates. Spot market conditions improved during the fourth quarter of 2011, mainly due to a substantial recovery in ammonia shipments out of the Black Sea and new ammonia production coming onstream in the Arabian Gulf. “The performance of the North Sea contracts of affreightment taken over from BW Gas in September was operationally and financially positive,” Exmar says.

In the very large gas carrier (VLGC) sector, the fourth quarter 2011 again saw a strong recovery in freight rates and timecharter equivalent earnings, driven by the expansion in Middle East LPG exports. However, by the end of the year, and into 2012, demand dropped, with several vessels left idle. “Despite the actual depressed market, it is expected that freight rates will rebound on the basis of strong fundamentals, limited newbuildings and increased product availability,” says Exmar.

In the fully pressurised segments, Exmar had full contract cover for 2011 and has achieved 70 per cent cover for this year. All vessels are trading at “profitable levels”, the company says.

EBIT from LNG operations fell from $92.8m in 2010 to $31.0m last year, although the prior year’s figures were inflated by a $47m profit on the sale of Exmar’s interest in the LNG carrier Excalibur and the LNG regasification vessel Excelsior. Exmar says the LNG market was “clearly the best performing” of all shipping markets in 2011 and that the LNG spot market is enjoying record levels on the back of strong growth in LNG production in the Middle East and increased demand in Asia. Last year’s figures were impacted somewhat by an unscheduled off-hire for the LNG carrier Excelerate; this year Excalibur, still operated by Exmar, is due for its second special survey and Excel is due to come off charter in July. The company’s results for 2012 will depend on how quickly Exmar can organise ongoing employment.

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