FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of May 2006
A/S STEAMSHIP COMPANY TORM
(Translation of registrant's name into English)
Tuborg Havnevej 18
DK-2900 Hellerup
Denmark
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form 20-F [X] Form 40-F[_]
Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information to
the commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes [_] No [X]
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Set forth herein as Exhibit 1 is a copy of Announcement No. 6 - 2006
issued by A/S STEAMSHIP COMPANY TORM (the "Company") to the Copenhagen Stock
Exchange on May 9, 2006.
Exhibit 1
TORM
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FIRST QUARTER REPORT 2006 - THE RESULT WAS BETTER THAN EXPECTED
Profit before tax for the first quarter of 2006 was USD 59.3
mill. (DKK 368.3 mill.). The result was better than expected.
Expectations for 2006 are maintained at USD 155-175 mill. before
tax.
Key points o Profit for the first quarter of 2006 was USD 59.3 mill. (DKK
368.3 mill.) before tax and USD 57.7 mill. (DKK 358.3 mill.)
after tax. The result was better than expected.
o Cash flow from operations was USD 75.7 mill. (DKK 470.1
mill.) for the quarter.
o Earnings per share (EPS) were USD 1.7 (DKK 10.3) in the
first quarter against USD 2.2 (DKK 12.5) for the same period
last year.
o Return on Invested Capital (RoIC) was 21.8% p.a., and Return
on Equity (RoE) was 24.9% p.a. for the quarter.
Shareholders' equity was USD 946 mill. (DKK 5,834 mill.) as
at 31 March 2006. A dividend of DKK 837 mill. (USD 139
mill.) was paid in April.
o The year started better than expected, but the product
tanker rates have been lower than expected during the end of
the first and into the second quarter. This was attributable
to an ongoing large influx of vessels combined with large
inventories in the US and maintenance of refineries in the
US and Asia. The period time charter market continues to be
relatively strong, which together with a recent increase in
fright rates is a positive indicator for the remainder of
the year. As per 31 March the Company had hedged 25% of the
remaining earning days for 2006.
o Dry bulk rates were in line with expectations. As per 31
March, the Company had hedged 65% the remaining earning days
for 2006.
o As at 31 March, TORM had hedged 37% of the remaining earning
days for 2006 and 53% of the total earning days in 2006.
o As at 31 March, the value adjustment on the Norden shares
was USD (21) mill. (DKK (188) mill.). On 4 April 2006, TORM
announced that the Company would in the near term actively
evaluate its shareholding in Norden.
o On 27 April TORM increased expectations for the year as a
whole to USD 155-175 mill. (DKK 930-1,050 mill.) before tax.
The expectations are maintained.
Telephone Telephone conference and webcast (www.torm.com) reviewing the
conference report for the first quarter 2006 will take place today, 9 May
2006, at 17:00 Copenhagen time. To participate, please call 10
minutes before the call on tel.: +45 3271 4607 (from Europe) or
+1 334 323 6201 (from the US). A replay of the conference will be
available from TORM's website.
Contact A/S Dampskibsselskabet TORM Tel.: +45 39 17 92 00
Tuborg Havnevej 18 Klaus Kjaerulff, CEO
DK-2900 Hellerup - Denmark Klaus Nyborg, CFO
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Mill. USD Q1 2006 Q1 2005 2005
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Income statement
Net revenue 161.8 132.3 587.0
Time charter equivalent earnings (TCE) 129.5 105.6 463.8
Gross profit 86.0 75.6 314.9
EBITDA 82.0 91.9 351.0
Operating profit 66.9 81.6 303.2
Financial items (7.6) (3.7) (3.8)
Profit before tax 59.3 77.9 299.4
Net profit 57.7 76.9 299.4
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Balance sheet
Total assets 1,859.8 1,499.0 1,810.1
Shareholders' equity 945.6 842.7 904.7
Total liabilities 914.2 656.3 905.4
Invested capital 1,281.5 806.0 1,175.8
Net interest bearing debt 676.1 379.9 632.1
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Cash flow
From operating activities 75.7 83.4 261.1
From investing activities (119.5) (193.6) (473.1)
Thereof investment in tangible fixed assets (119.7) (221.6) (635.9)
From financing activities 7.4 137.4 303.2
Net cash flow (36.4) 27.2 91.2
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Key Financial figures
Margins:
TCE 80.0% 79.8% 79.0%
Gross profit 53.2% 57.1% 53.7%
EBITDA 50.7% 69.5% 59.8%
Operating profit 41.3% 61.7% 51.6%
Return on Equity (RoE) (p.a.) 24.9% 39.5% 36.9%
Return on Invested Capital (RoIC) (p.a.) 21.8% 45.9% 33.8%
Equity ratio 50.8% 56.2% 50.0%
Exchange rate USD/DKK, end of period 6.17 5.75 6.32
Exchange rate USD/DKK, average 6.21 5.68 6.00
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Share related key figures
Earnings per share, EPS USD 1.7 2.2 8.6
Cash flow per share, CFPS USD 2.2 2.4 7.5
Share price, end of period
(per share of DKK 10 each) DKK 282.6 303.9 305.1
Number of shares, end of period Mill. 36.4 36.4 36.4
Number of shares, (excl. treasury shares),
average Mill. 34.8 34.8 34.8
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Profit by division
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Mill. USD Q1 2006
-------------------------------------
Tanker Bulk Not
division division allocated Total
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Net revenue 130.7 31.1 0.0 161.8
Port expenses, bunkers and commissions (30.7) (1.6) 0.0 (32.3)
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Time charter equivalent earnings (TCE)*) 100.0 29.5 0.0 129.5
Charter hire (12.0) (11.4) 0.0 (23.4)
Operating expenses (16.0) (4.1) 0.0 (20.1)
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Gross profit 72.0 14.0 0.0 86.0
Profit from sale of vessels 0.0 0.0 0.0 0.0
Administrative expenses (5.9) (1.2) 0.0 (7.1)
Other operating income 2.9 0.2 0.0 3.1
Depreciation and impairment losses (12.4) (2.7) 0.0 (15.1)
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Operating profit 56.6 10.3 0.0 66.9
Financial items - - (7.6) (7.6)
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Profit before tax
- - (7.6) 59.3
Tax - - (1.6) (1.6)
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Net profit after tax for the period - - (9.2) 57.7
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*) TCE is gross freight income less bunker, commissions and port expenses (TCE
= Time Charter Equivalent).
Tanker and Bulk
Tanker Division The Tanker Division achieved a profit of USD 56.6 mill.
before financial items in the first quarter of 2006.
The product tanker rates started the year at a very high
level. From the middle of the quarter, however, rates
decreased to very low levels, but have rebounded
significantly recently.
There have been substantial variations between the product
tanker rates in the west and the east. Freight rates
especially in the MR segment have been significantly better
in the west. TORM has traded a majority of its vessels in
the west, which has, benefited earnings considerably.
In line with normal seasonal patterns, a slowdown in the
tanker market takes place towards the end of the first and
into the second quarter as the winter season ended,
resulting in a tailing off in the transportation of heating
oil. This year the decrease in freight rates has been more
pronounced than normal.
At the end of the first and into the second quarter of 2006
freight rates in the Tanker Division have been highly
affected by:
o A warmer than normal winter in the US.
o More inspections than usual of refineries and
petrochemical plants in the Far- and the Middle East.
o An ongoing considerable growth in the global product
tanker fleet.
TORM's Tanker Division achieved freight rates in the first
quarter of 2006 which when compared to the first quarter of
2005 were 22% higher for the LR2 segment, 8% higher for the
LR1 segment and 2% higher for the MR segment. The MR segment
was the strongest during the first quarter.
The number of earning days in the LR2 segment increased by
18% compared to first quarter of 2005. The number of earning
days in the LR1 and MR segments increased by 83% and 42%,
respectively. Compared to the fourth quarter of 2005, the
number of earning days increased by 1% for the total tanker
fleet.
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Tanker Division Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Change
-Q1 05
-Q1 06
--------------------------------------------------------------------------------------------------------------------
LR2 (Aframax, 90-110,000 DWT)
Available earning days 450 442 548 550 529 18%
Per earning day (USD):
Earnings (TCE)*) 35,715 30,281 28,185 45,917 43,553 22%
Operating expenses (5,526) (4,849) (5,899) (6,157) (5,464) (1%)
Operating cash flow**) 27,570 18,726 14,172 30,316 33,526 22%
--------------------------------------------------------------------------------------------------------------------
LR1 (Panamax, 75-85,000 DWT)
Available earning days 498 652 774 827 912 83%
Per earning day (USD):
Earnings (TCE)*) 32,704 26,906 26,509 41,726 35,356 8%
Operating expenses (4,991) (6,836) (6,074) (5,680) (5,730) 15%
Operating cash flow**) 21,647 11,769 15,090 27,964 22,113 2%
--------------------------------------------------------------------------------------------------------------------
MR (45,000 DWT)
Available earning days 1,125 1,270 1,547 1,638 1,599 42%
Per earning day (USD):
Earnings (TCE)*) 27,465 26,079 23,499 29,373 28,118 2%
Operating expenses (6,223) (6,594) (6,274) (6,505) (7,199) 16%
Operating cash flow**) 20,261 18,788 17,738 23,598 21,730 7%
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*) TCE = Gross freight income less bunker, commissions and port expenses.
Operating expenses are on own vessels.
**) Operating cash flow = TCE less operating expenses and charter hire.
Bulk Division The Bulk Division achieved a profit before financial items
of USD 10.3 mill. in the first quarter of 2006.
The dry bulk freight rates were significantly lower in the
first quarter of 2006 than in the first quarter of 2004 and
2005 respectively. In the Panamax segment the freight rates
were on average USD 20,324/day, which was still above the
historical average of USD 12,600/day (source: Clarksons).
The development in the bulk market continues to be highly
dependent on the development in certain markets, especially
China but also India, Japan and South America. Due to a
large influx of vessels dry bulk freight rates were as
expected not positively influenced by the South American
grain season. The iron ore price negotiations for the sale
of this commodity to the Chinese steel industry from 1 April
2006 are not yet finalized and did not, as expected, give
rise to higher dry bulk freight rates.
In the first quarter of 2006, the number of available
earning days was 2% higher for TORM's Panamax vessels
compared to the first quarter of 2005.
In the first quarter of 2006, the number of available
earning days was 10% lower for TORM's Handysize vessels
compared to the first quarter of 2005. The decrease was due
to the re-delivery of chartered-in tonnage.
------------------------------------------------------------------------------------------------------------------------
Bulk Division Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Change
Q1 05
-Q1 06
--------------------------------------------------------------------------------------------------------------------
Panamax (60-80,000 DWT)
Available earning days 1,324 1,203 1,240 1,356 1,346 2%
Per earning day (USD):
Earnings (TCE)*) 30,641 30,962 27,523 22,585 20,324 (34%)
Operating expenses (4,794) (4,607) (4,294) (5,017) (4,572) (5%)
Operating cash flow**) 20,495 21,792 12,241 12,136 9,430 (54%)
--------------------------------------------------------------------------------------------------------------------
Handysize (20-35,000 DWT)
Available earning days 199 206 215 197 179 (10%)
Per earning day (USD):
Earnings (TCE)*) 18,952 17,645 14,514 13,067 12,479 (34%)
Operating expenses (2,916) (3,908) (3,690) (5,049) (4,583) 57%
Operating cash flow**) 15,306 13,172 9,150 7,745 7,987 (48%)
--------------------------------------------------------------------------------------------------------------------
*) TCE = Gross freight income less bunker, commissions and port expenses.
Operating expenses are on own vessels.
**) Operating cash flow = TCE less operating expenses and charter hire.
Other activities Other (non allocated) activities consist of financial items
of USD (7.6) mill. and tax of USD (1.6) mill.
Fleet development TORM has during the first quarter of 2006 taken delivery of
DIFKO Lisbeth, which was resold to Nordic Tankers A/S for
delivery in the second quarter of 2006. TORM has also taken
delivery of two LR2 product tankers, which were chartered in
with purchase options that were exercised in the fourth
quarter of 2005.
At the end of the first quarter of 2006, TORM's fleet
consisted of 30 tankers and 10 bulk carriers, totalling 40
vessels.
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31 Dec 2005 Addition Disposal 31 March 2006
-------------------------------------------------------------------------------
LR2 / Aframax 3.0 TORM Gudrun - 5.0
TORM Kristina
LR1 / Panamax 6.0 DIFKO Lisbeth - 7.0
MR 18.0 - - 18.0
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Tank 27.0 3.0 - 30.0
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Panamax 8.0 - - 8.0
Handysize 2.0 - - 2.0
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Bulk 10.0 - - 10.0
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Total 37.0 3.0 - 40.0
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Planned fleet Early in 2006, the Company entered into a contract for the
changes construction of a further two MR product tankers with "1A
Super" Ice Class designation for delivery in 2009. [GRAPHIC
OMITTED][GRAPHIC OMITTED] TORM has alignments in place for
16 product tankers to be chartered-in, of which six already
form part of the fleet. There is a purchase option on three
of the chartered in vessels that can be exercised in 2009
and beyond.
31 March 2006 2006 2007 2008 2009 Total
------------- ---- ---- ---- ---- -----
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Ql Q2 Q3 Q4 Q1 Q2 Q3 Q4
LR2 5 1 1 - 1 1 - 0.5 - 1 - 1 1 - - - 7.5
LR1 7 -1 - 0.5 1 - - - - - - - - - - - 0.5
MR 18 - - - - - - - - - 1 - 1 - 1 1 4
Panamax 8 - - - - - - - - - - - - - - - 0
Handysize 2 - - - - - - - - - - - - - - - 0
Total 40 0 1 0.5 2 1 0 0.5 0 1 1 1 2 0 1 1 12
TOTM has alignments in place for 16 product tankers to be
chartered-in, of which six already form part of the fleet.
There is a purchase option on three of the chartered in
vessels that can be exercised in 2009 and beyond.
TORM holds purchase options on four Panamax bulk vessels,
all of which form part of the fleet at present. The options
can be exercised in 2007 and beyond.
Pools As at 31 March 2006 the three product tanker pools consisted
of 77 vessels. At the end of 2006, 84 vessels are expected
to be in the pools.
During the first quarter of 2006 BW Shipping Managers Pte.
Ltd., Singapore (previously Bergesen-Worldwide) entered into
an agreement with TORM to join the LR1 pool from 2007 when
the first of four newbuildings will be delivered.
Results
First quarter 2006 The first quarter of 2006 resulted in a gross profit of USD
86 mill. (USD 76 mill. in the same quarter of 2005). Profit
before depreciation for the period was USD 82 mill. (USD 92
mill.).
Depreciation was USD 15 mill. during the first quarter of
2006 (USD 10 mill.). The increase in depreciation is the
result of the growth in the Company's fleet.
Profit before financial items for the first quarter of 2006
was USD 67 mill. (USD 82 mill.). Of this, the Tanker- and
Bulk divisions contributed USD 57 mill. and USD 10 mill.
respectively.
Financial items were negative by USD 8 mill. (USD 4 mill.),
mainly due to the payment of interest on the Company's
mortgage debt which increased by USD 296 mill. compared to
the first quarter of 2005.
Profit after tax was USD 58 mill. (USD 77 mill.).
Assets Total assets increased during the first quarter of 2006 from
USD 1,810 mill. to USD 1,860 mill., mainly as a result of
increasing non-current assets from USD 1,528 mill. to USD
1,605 mill. This was related to the net impact of vessels
purchased countered by the value adjustment of the
investment in Dampskibsselskabet "NORDEN" A/S (Norden) by
USD (21) mill. and by depreciation by USD 15 mill. during
the period.
The value adjustment on the Norden shares is a consequence
of a decrease in the share price from DKK 2,959 as of 31
December 2005 to DKK 2,709 on 31 March 2006 offset by the
adverse effect of a change in the USD/DKK exchange rate from
6.32 to 6.17 in the same period.
Liabilities During the first quarter of 2006, net interest bearing debt
increased from USD 632 mill. to USD 676 mill. The increase
was mainly due to higher net borrowing in connection with
the delivery of vessels, countered by positive cash earnings
in the period. The Company has considerable undrawn loan
facilities at its disposal.
Shareholders' During the first quarter of 2006, shareholders' equity
equity increased from USD 905 mill. to USD 946 mill. as a result of
improved earnings during the period. Shareholders equity as
a percentage of total assets increased from 50.0% at 31
December 2005 to 50.8% at 31 March 2006.
At 31 March 2006, TORM owned 1,558,472 own shares
corresponding to 4.3% of the Company's share capital, which
is unchanged from 31 December 2005.
Subsequent events Norden has since the end of the first quarter of 2006 paid a
dividend, which for TORM equals to an income of USD 25
mill., which is included in the expectations.
TORM has since the end of the first quarter of 2006 sold the
two Handysize bulk vessels TORM Arawa (built in 1997) and
TORM Pacific (built in 1997). The vessels are sold to
Pacific Basin in Hong Kong for total consideration of USD
35.1 mill, which is included in the expectations.
Expectations TORM maintains the expectations for 2006 at USD 155-175
mill. as stated in announcement no. 5 of 27 April 2006 where
the expectations were increased by USD 15 mill. compared to
the Company's original earning expectations for 2006.
During the first quarter of 2006, rates for the Tanker
Division were better than originally expected as at 8 March
2006 (date for the release of the Annual Report 2005).
Rates in TORM's Bulk Division have been in line with
expectations.
Sensitivity At the beginning of the second quarter of 2006, 66% of the
earning days for the remainder of the year were hedged in
respect of the Company's Panamax bulk vessels. For the
Tanker Division, about 25% of the remaining earning days
were hedged at the outset of the second quarter.
A change in the freight rates of 1,000 USD/day of the
non-hedged freight rates in the remaining 3 quarters of the
year would, all things being equal, lead to a change in net
profit of USD 9 mill.
As at 31 March 2006, the Company had hedged the price for
26% of its remaining bunker requirements for 2006, and the
market value of these contracts as at year-end was USD 2.4
mill. A hypothetical price change of +/-1% point per ton of
bunker oil would lead to a change in expenditure in 2006 of
USD +/-0.7 mill. based on the expected bunker consumption.
Safe Harbor Matters discussed in this release may constitute
Forward looking forward-looking statements. Forward-looking statements
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 other
statements, which are other than statements of historical
facts. 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 TORM believes 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, TORM
cannot assure you 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 world
economies and currencies, changes in charter hire rates and
vessel values, changes in demand for "tonne 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
governmental rules and regulations 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 and
political events or acts by terrorists. Risks and
uncertainties are further described in reports filed by TORM
with the US Securities and Exchange Commission, including
the TORM Annual Report on Form 20-F and its reports on Form
6-K.
Forward looking statements are based on management's current
evaluation, and TORM is only under obligation to update and
change the listed expectations to the extent required by
law.
The TORM share
The price of a TORM share was DKK 282.6 as at 31 March 2006
against DKK 305.1 at the beginning of the year corresponding
to a total return of (7.4)% in the quarter.
Accounting policies
The accounts for the first quarter of 2006 have been
prepared using the same accounting policies as for the
Annual Report 2005.
The accounting policies are described in more detail in the
Annual Report 2005.
The quarterly report for the first quarter of 2006 is
unaudited, in line with normal practice.
Information
Telephone TORM will host a telephone conference for financial analysts
conference and investors on 9 May 2006 at 17:00, Copenhagen time,
reviewing the report for the first quarter of 2006. The
conference call will be hosted by Klaus Nyborg, CFO, and
will be conducted in English.
Please call 10 minutes before the call starts on tel.: +45
3271 4607 (from Europe) or +1 334 323 6201 (from the US).
The telephone conference will also be broadcast via TORM's
website, www.torm.com, which will also contain the
presentation material.
Next reporting TORM's financial report for the second quarter of 2006 will
be released on 9 August 2006.
Statement by the Board of Directors and Management on the
Interim Report
The Board of Directors and Management have considered and
approved the interim report for the period 1 January - 31
March 2006.
The interim report, which is unaudited, has been prepared in
accordance with the general Danish financial reporting
requirements governing listed companies, including the
measurement and recognition provisions in IFRS which are
expected to be applicable for the Annual Report for 2006.
We consider the accounting policies applied to be
appropriate, and in our opinion the interim report gives a
true and fair view of the Group's assets, liabilities,
financial position and of the results of operations and
consolidated cash flows.
Copenhagen, 9 May 2006
Management Board of Directors
Klaus Kjaerulff, CEO Niels Erik Nielsen, Chairman
Klaus Nyborg, CFO Christian Frigast, Deputy chairman
Lennart Arrias
Ditlev Engel
Peder Mouridsen
Gabriel Panayotides
Nicos Zouvelos
About TORM TORM is one of the world's leading carriers of refined oil
products as well as being a significant participant in the
dry bulk market. The Company operates a combined fleet of
close to 100 modern vessels, principally through a pooling
cooperation with other respected shipping companies who
share TORM's commitment to safety, environmental
responsibility and customer service.
TORM was founded in 1889 and has consistently adapted itself
to, and benefited from, the enormous changes which
characterise the shipping industry in general. The Company
conducts business worldwide and is headquartered in
Copenhagen, Denmark. TORM's shares are listed on the
Copenhagen Stock Exchange (ticker TORM) as well as on the
NASDAQ (ticker TRMD). For further information, please visit
www.torm.com.
Income Statement
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Mill. USD Q1 2006 Q1 2005 2005
-------------------------------------------------------------------------------
Net revenue 161.8 132.3 586.9
Port expenses, bunkers and commissions (32.3) (26.7) (123.1)
-------------------------------------------------------------------------------
Time charter equivalent earnings (TCE) 129.5 105.6 463.8
Charter hire (23.4) (16.5) (82.2)
Operating expenses (20.1) (13.5) (66.7)
-------------------------------------------------------------------------------
Gross profit 86.0 75.6 314.9
Profit from sale of vessels 0.0 19.4 54.7
Administrative expenses (7.1) (6.6) (31.2)
Other operating income 3.1 3.5 12.6
Depreciation and impairment losses (15.1) (10.3) (47.8)
-------------------------------------------------------------------------------
Operating profit 66.9 81.6 303.2
Financial items (7.6) (3.7) (3.8)
-------------------------------------------------------------------------------
Profit before tax 59.3 77.9 299.4
Tax (1.6) (1.0) 0.0
-------------------------------------------------------------------------------
Net profit after tax for the period 57.7 76.9 299.4
-------------------------------------------------------------------------------
Earnings per share, EPS (USD) 1.7 2.2 8.6
Earnings per share, EPS (DKK)*) 10.3 12.5 51.5
-------------------------------------------------------------------------------
*) Calculated from USD to DKK at the average USD/DKK exchange rate for the
relevant period.
Income statement by quarter
-----------------------------------------------------------------------------------------------------------
Mill. USD Q1 05 Q2 05 Q3 05 Q4 05 Q1 06
-----------------------------------------------------------------------------------------------------------
Net revenue 132.3 132.1 142.2 180.3 161.8
Port expenses, bunkers and commissions 26.7) (28.4) (32.8) (35.2) (32.3)
-----------------------------------------------------------------------------------------------------------
Time charter equivalent earnings (TCE) 105.6 103.7 109.4 145.1 129.5
Charter hire 16.5) (17.4) (19.1) (29.2) (23.4)
Operating expenses 13.5) (16.3) (18.2) (18.7) (20.1)
-----------------------------------------------------------------------------------------------------------
Gross profit 75.6 70.0 72.1 97.2 86.0
Profit from sale of vessels 19.4 21.0 14.4 (0.1) 0.0
Administrative expenses (6.6) (6.7) (7.8) (10.1) (7.1)
Other operating income 3.5 2.8 2.6 3.7 3.1
Depreciation and impairment losses 10.3) (11.2) (12.5) (13.8) (15.1)
-----------------------------------------------------------------------------------------------------------
Operating profit 81.6 75.9 68.8 76.9 66.9
Financial items (3.7) 10.0 (2.3) (7.8) (7.6)
-----------------------------------------------------------------------------------------------------------
Profit before tax 77.9 85.9 66.5 69.1 59.3
Tax (1.0) (1.7) 0.2 2.5 (1.6)
-----------------------------------------------------------------------------------------------------------
Net profit after tax for the period 76.9 84.2 66.7 71.6 57.7
-----------------------------------------------------------------------------------------------------------
Assets
--------------------------------------------------------------------------------
Mill. USD 31 March 31 March 31 Dec
2006 2005 2005
--------------------------------------------------------------------------------
NON-CURRENT ASSETS
Tangible fixed assets
Land and buildings 0.9 0.4 0.9
Vessels and capitalized dry-docking 1,140.5 680.5 1,066.5
Vessels under construction and prepayments
for vessels 120.7 155.9 97.4
Other plant and operating equipment 2.3 2.8 2.3
-------------------------------------------------------------------------------
Total tangible fixed assets 1,264.4 839.6 1,167.1
-------------------------------------------------------------------------------
Financial fixed assets
-------------------------------------------------------------------------------
Other investments 340.2 416.6 361.0
-------------------------------------------------------------------------------
TOTAL NON-CURRENT ASSETS 1,604.6 1,256.2 1,528.1
-------------------------------------------------------------------------------
CURRENT ASSETS
Inventories of bunkers 12.1 6.5 10.9
Freight receivables, etc. 40.1 32.1 53.9
Other receivables 23.8 12.6 14.1
Prepayments 8.2 7.0 2.9
Marketable securities 0.0 60.2 0.2
Cash and cash equivalents 120.3 92.7 156.7
-------------------------------------------------------------------------------
204.5 211.1 238.7
Non-current assets held for sale 50.7 31.7 43.3
-------------------------------------------------------------------------------
TOTAL CURRENT ASSETS 255.2 242.8 282.0
-------------------------------------------------------------------------------
TOTAL ASSETS 1,859.8 1,499.0 1,810.1
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Liabilities and Shareholders' equity
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Mill. USD 31 March 31 March 31 Dec
2006 2005 2005
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SHAREHOLDERS' EQUITY
Common shares 61.1 61.1 61.1
Treasury shares (7.7) (7.7) (7.7)
Revaluation reserves 275.6 367.4 296.4
Retained profit 473.4 315.8 415.3
Proposed dividend 132.4 99.9 132.4
Hedging reserves 6.9 2.3 3.3
Translation reserves 3.9 3.9 3.9
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TOTAL SHAREHOLDERS' EQUITY 945.6 842.7 904.7
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LIABILITIES
Non-current liabilities
Deferred tax 56.0 64.9 54.5
Mortgage debt and bank loans 735.7 370.7 729.1
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TOTAL NON-CURRENT LIABILITIES 791.7 435.6 783.6
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Current liabilities
Mortgage debt and bank loans 60.7 56.8 59.9
Other financial liabilities 0.0 105.3 0.0
Trade payables 18.1 16.7 22.9
Current tax liabilities 9.6 14.7 9.4
Other liabilities 32.0 20.8 23.6
Deferred income 2.1 6.4 6.0
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TOTAL NON-CURRENT LIABILITIES 122.5 220.7 121.8
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TOTAL LIABILITIES 914.2 656.3 905.4
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 1,859.8 1,499.0 1,810.1
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Shareholders' equity
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Mill. USD Common Treasury Revalution Retained Proposed Hedging Translation
shares shares reserves profit dividend reserves reserves Total
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Balance at 1 January 2006 61.1 (7.7) 296.4 415.3 132.4 3.3 3.9 904.7
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Changes in Shareholders' equity Q1 2006:
Exchange rate adjustment arising on
translation of entities using a
measurement currency different from USD - - - - - - 0.0 0.0
Reversal of deferred gain/loss on cash flow
hedges at beginning of period - - - - - (3.3) - (3.3)
Deferred gain/loss on cash flow hedges at
period end - - - - - 6.9 - 6.9
Reversal of fair value adjustment on
available for sale investments at
beginning of period - - (296.4) - - - - (296.4)
Fair value adjustment on available for sale
investment at period end - - 275.6 - - - - 275.6
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Net income recognized directly in equity 0.0 0.0 (20.8) 0.0 0.0 3.6 0.0 (17.2)
Profit for the period - - - 57.7 - - - 57.7
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Total income for the period 0.0 0.0 (20.8) 57.7 0.0 3.6 0.0 40.5
Disposal of own shares, cost - 0.0 - - - - - 0.0
Dividends paid - - - - - - - 0.0
Dividends paid on own shares - - - - - - - 0.0
Exchange rate adjustment on dividends paid - - - - - - - 0.0
Exercise of share options - - - 0.4 - - - 0.4
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Total changes in Shareholders' equity Q1 0.0 0.0 (20.8) 58.1 0.0 3.6 0.0 40.9
2006
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Balance at 31 March 2006 61.1 (7.7) 275.6 473.4 132.4 6.9 3.9 945.6
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Cash flow statement
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Mill. USD Q1 Q1 2005
2006 2005
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Cash flow from operating activities
Operating profit 66.9 81.6 303.2
Adjustments:
Reversal of profit from sale of vessels 0.0 (19.4) (54.7)
Reversal of depreciation and impairment loss 15.1 10.3 47.9
Reversal of other non-cash movements 5.5 (9.4) (6.5)
Dividends received 0.2 0.2 12.8
Interest income and exchange rate gains 1.1 1.1 7.8
Interest expenses (10.3) (4.8) (26.1)
Income taxes paid 0.0 0.0 (7.5)
Change in inventories, accounts receivables
and payables (2.8) 4.4 (15.8)
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Net cash inflow from operating activities 75.7 64.0 261.1
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Cash flow from investing activities
Investment in tangible fixed assets (119.7) (221.6) (635.9)
Investment in equity interests and securities 0.2 0.0 (15.4)
Sale of non-current assets 0.0 47.4 178.2
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Net cash inflow/(outflow) from investing (119.5) (174.2) (473.1)
activities
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Cash flow from financing activities
Borrowing, mortgage debt and other financial
liabilities 11.2 159.1 645.5
Repayment/redemption, mortgage debt (3.8) (21.7) (251.9)
Dividends paid 0.0 0.0 (90.4)
Purchase/disposals of treasury shares 0.0 0.0 0.0
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Cash inflow/(outflow) from financing activities 7.4 137.4 303.2
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Increase/(decrease) in cash and cash equivalents (36.4) 27.2 91.2
Cash and cash equivalents, beginning of period 156.7 65.5 65.5
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Cash and cash equivalents, end of period 120.3 92.7 156.7
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Quarterly cash flow statement
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Mill. USD Q1 05 Q2 05 Q3 05 Q4 05 Q1 06
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Cash flow from operating activities
Operating profit 81.6 75.9 68.8 76.9 66.9
Adjustments:
Reversal of profit from sale of vessels (19.4) (21.0) (14.4) 0.1 0.0
Reversal of depreciation and impairment loss 10.3 11.2 12.5 13.9 15.1
Reversal of other non-cash movements (9.4) (0.1) 3.0 0.0 5.5
Dividends received 0.2 12.6 0.0 0.0 0.2
Interest income and exchange rate gains 1.1 1.0 0.6 5.1 1.1
Interest expenses (4.8) (5.9) (6.7) (8.7) (10.3)
Income taxes paid 0.0 0.0 0.0 (7.5) 0.0
Change in inventories, accounts receivables and
payables 4.4 2.8 (7.0) (16.0) (2.8)
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Net cash inflow from operating activities 64.0 76.5 56.8 63.8 75.7
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Cash flow from investing activities
Investment in tangible fixed assets (221.6) (249.9) (145.8) (18.6) (119.7)
Investment in equity interests and securities 0.0 34.3 3.2 (52.9) 0.2
Sale of non-current assets 47.4 41.4 36.4 53.0 0.0
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Net cash inflow/(outflow) from investing
activities (174.2) (174.2) (106.2) (18.5) (119.5)
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Cash flow from financing activities
Borrowing, mortgage debt and other financial
liabilities 159.1 208.8 158.6 119.0 11.2
Repayment/redemption, mortgage debt (21.7) (74.0) (122.7) (33.5) (3.8)
Repayment/redemption, lease liabilities 0.0 0.0 0.0 0.0 0.0
Dividends paid 0.0 (90.4) 0.0 0.0 0.0
Purchase/disposals of treasury shares 0.0 0.0 0.0 0.0 0.0
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Cash inflow/(outflow) from financing activities 137.4 44.4 35.9 85.5 7.4
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Increase/(decrease) in cash and cash equivalents 27.2 (53.3) (13.5) 130.8 (36.4)
Cash and cash equivalents, beginning of period 65.5 92.7 39.4 25.9 156.7
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Cash and cash equivalents, end of period 92.7 39.4 25.9 156.7 120.3
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Reconciliation to United States Generally Accepted Accounting Principles (US
GAAP)
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Mill. USD Net income Shareholders' Equity
Q1 2006 31 Mar. 2006
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As reported under IFRS 57.7 945.6
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Adjustments:
Reversal of write-down of vessels 0.0 (0.5)
Deferred gain on a sale/lease back 1.1 (16.3)
Deferred tax (0.3) 4.6
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Total adjustments 0.8 (12.2)
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According to US GAAP 58.5 933.4
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A review of principles and methods used in the reconciliation, please refer to
the TORM Annual Report for 2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
A/S STEAMSHIP COMPANY TORM
(registrant)
Dated: May 10, 2006 By: /s/ Klaus Nyborg
-----------------------
Klaus Nyborg
Chief Financial Officer
03810 0001 668530