TORM A/S
(registrant)
|
||
Dated: August 23, 2012
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By:
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/s/ Jacob Meldgaard
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Name: | Jacob Meldgaard | |
Title: | Chief Executive Officer |
Second quarter report 2012
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·
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The financial results were adversely affected by TORM's financial situation. EBITDA for the second quarter of 2012 was a loss of USD 23 million including negative mark-to-market non-cash adjustments of USD 8 million and loss from sale of vessels of USD 5 million in a jointly controlled company, compared to an EBITDA gain of USD 30 million in the second quarter of 2011. Impairment losses from FR8 accounted for USD 42 million in the second quarter of 2012, compared to no impairment losses in the same period of 2011. In addition, financial expenses for the second quarter of 2012 include USD 18 million in restructuring costs. The result before tax for the second quarter of 2012 was a loss of USD 132 million, compared to a loss of USD 24 million in the same period of 2011.
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·
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The product tanker freight rates continued to be under pressure in the second quarter of 2012, as global economic indicators were sluggish. In the West, MR freight rates were negatively affected by weaker US East Coast product demand and higher US refinery utilization. In the East, the freight markets for LR2 and LR1 vessels saw an increase in activity in June mainly due to the effects of the jet oil arbitrage from the Arabian Gulf to Europe. In general, the markets are still suffering from tonnage oversupply.
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·
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The bulk market experienced positive freight rate movements in April 2012 as a result of the South American grain season, which was replaced by a negative market sentiment due to the macroeconomic uncertainty and events like the Indonesian commodity export ban. The second quarter of 2012 continued to see a high influx of newbuildings in all main segments.
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·
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As stated in announcement no. 14 dated 4 April 2012 and further elaborated in announcement no. 20 dated 23 April 2012, TORM is still working closely with its banks and time charter partners on a financing and restructuring plan.
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·
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The completion of a restructuring agreement is a prerequisite for TORM's continued operation.
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·
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TORM's cost program has led to a reduction of administration costs to USD 17 million in the second quarter of 2012, equivalent to a reduction of 7% compared to the same period of 2011.
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·
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In the second quarter of 2012, TORM sold its shares in a JV entity which main asset was the 2007-built LR1 vessel, TORM Ugland. This led to a loss of USD 5 million which is booked under results from jointly controlled entities.
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·
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The book value of the fleet excluding financial lease vessels as of 30 June 2012 was USD 2,193 million. Based on broker valuations, TORM's fleet excluding financial lease vessels had a market value of USD 1,370 million as of 30 June 2012. TORM estimates the fleet's total long-term earning potential each quarter based on future discounted cash flows. The estimated value for the fleet as at 30 June 2012 supports the book value.
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·
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Net interest-bearing debt amounted to USD 1,852 million in the second quarter of 2012 compared to USD 1,838 million as at 31 March 2012.
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·
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Cash totalled USD 17 million at the end of the second quarter of 2012 and the Company has no available credit lines. TORM has no order book and therefore no CAPEX related hereto. As at 20 August 2012 the cash totalled USD 33 million.
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·
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Booked equity amounted to USD 435 million as at 30 June 2012, equivalent to USD 6.2 per share (excluding treasury shares), giving TORM an equity ratio of 17%.
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·
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As at 30 June 2012, TORM had covered 12% of the remaining tanker earning days in 2012 at USD/day 14,300 and 4% of the earning days in 2013 at USD/day 15,005. 119% of the remaining bulk earning days in 2012 are covered at USD/day 12,148 and 27% of the 2013 earnings days at USD/day 17,454.
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Announcement no. 30 / 21 August 2012
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Second quarter report 2012
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Page 1 of 21
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·
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The financial result for 2012 is subject to considerable uncertainty given TORM's financial situation and the changes to the Company's business model that may follow. Consequently, TORM has decided not to provide earnings guidance for 2012 until the comprehensive, long-term financing solution is in place.
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Teleconference
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Contact TORM A/S
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TORM will be holding a teleconference for financial analysts and investors at 15:00 Danish time today. Please call 10 minutes before the conference is due to start on +45 3271 4607 (from Europe) or +1 887 491 0064 (from the USA). The presentation documents can be downloaded from TORM's website.
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Tuborg Havnevej 18, DK-2900 Hellerup, Denmark
Tel.: +45 39 17 92 00 / Fax: +45 39 17 93 93
www.torm.com
Jacob Meldgaard, CEO, tel.: +45 39 17 92 00
Roland M. Andersen, CFO, tel.: +45 39 17 92 00
Christian Søgaard-Christensen, IR, tel.: +45 30 76 12 88
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Key figures
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||||||||||||||||||||
Q1-Q2 | Q1-Q2 | ||||||||||||||||||||
Million USD
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Q2 2012 | Q2 2011 | 2012 | 2011 | 2011 | ||||||||||||||||
Income statement
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|||||||||||||||||||||
Revenue
|
272.3 | 335.7 | 582.9 | 606.1 | 1,305.2 | ||||||||||||||||
Time charter equivalent earnings (TCE)
|
102.6 | 178.8 | 254.6 | 326.3 | 644.3 | ||||||||||||||||
Gross profit
|
0.6 | 39.1 | 27.9 | 66.9 | 81.0 | ||||||||||||||||
EBITDA
|
-22.9 | 29.5 | -30.0 | 33.6 | -43.8 | ||||||||||||||||
Operating profit (EBIT)
|
-98.5 | -7.0 | -139.6 | -39.5 | -388.6 | ||||||||||||||||
Profit/(loss) before tax
|
-132.1 | -23.7 | -210.6 | -68.6 | -451.4 | ||||||||||||||||
Net profit/(loss)
|
-132.1 | -24.3 | -210.8 | -69.6 | -453.0 | ||||||||||||||||
Balance sheet
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|||||||||||||||||||||
Total assets
|
2,543.8 | 3,201.8 | 2,543.8 | 3,201.8 | 2,779.2 | ||||||||||||||||
Equity
|
434.5 | 1,036.9 | 434.5 | 1,036.9 | 643.8 | ||||||||||||||||
Total liabilities
|
2,109.3 | 2,164.9 | 2,109.3 | 2,164.9 | 2,135.4 | ||||||||||||||||
Invested capital
|
2,274.4 | 2,857.7 | 2,274.4 | 2,857.7 | 2,425.1 | ||||||||||||||||
Net interest bearing debt
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1,851.8 | 1,823.9 | 1,851.8 | 1,823.9 | 1,786.8 | ||||||||||||||||
Cash flow
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|||||||||||||||||||||
From operating activities
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-19.5 | -30.2 | -76.1 | -41.3 | -74.8 | ||||||||||||||||
From investing activities
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5.9 | 60.3 | 11.1 | 93.4 | 168.1 | ||||||||||||||||
Thereof investment in tangible fixed assets
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-4.4 | -34.4 | -48.5 | -102.4 | -118.5 | ||||||||||||||||
From financing activities
|
0.9 | -25.4 | -3.8 | -25.0 | -127.8 | ||||||||||||||||
Total net cash flow
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-12.7 | 4.7 | -68.8 | 27.1 | -34.5 | ||||||||||||||||
Key financial figures
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|||||||||||||||||||||
Gross margins:
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|||||||||||||||||||||
TCE
|
37.7 | % | 53.3 | % | 43.7 | % | 53.8 | % | 49.4 | % | |||||||||||
Gross profit
|
0.2 | % | 11.6 | % | 4.8 | % | 11.0 | % | 6.2 | % | |||||||||||
EBITDA
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-8.4 | % | 8.8 | % | -5.1 | % | 5.5 | % | -3.4 | % | |||||||||||
Operating profit
|
-36.2 | % | -2.1 | % | -23.9 | % | -6.5 | % | -29.8 | % | |||||||||||
Return on Equity (RoE) (p.a.)*)
|
-98.0 | % | -10.7 | % | -75.2 | % | -12.9 | % | -51.5 | % | |||||||||||
Return on Invested Capital (RoIC) (p.a.)**)
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-16.8 | % | -1.7 | % | -11.2 | % | -2.8 | % | -14.4 | % | |||||||||||
Equity ratio
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17.1 | % | 32.4 | % | 17.1 | % | 32.4 | % | 23.2 | % | |||||||||||
Exchange rate USD/DKK, end of period
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5.90 | 5.16 | 5.90 | 5.16 | 5.75 | ||||||||||||||||
Exchange rate USD/DKK, average
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5.80 | 5.18 | 5.73 | 5.32 | 5.36 | ||||||||||||||||
Share related key figures
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|||||||||||||||||||||
Earnings per share, EPS
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USD
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-1.9 | -0.3 | -3.0 | -1.0 | -6.5 | |||||||||||||||
Diluted earnings per share, EPS
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USD
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-1.9 | -0.3 | -3.0 | -1.0 | -6.5 | |||||||||||||||
Cash flow per share, CFPS
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USD
|
-0.3 | -0.4 | -1.1 | -0.6 | -1.1 | |||||||||||||||
Share price, end of period (per share of DKK 5 each)
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DKK
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2.1 | 21.7 | 2.1 | 21.7 | 3.7 | |||||||||||||||
Number of shares, end of period
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Million
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72.8 | 72.8 | 72.8 | 72.8 | 72.8 | |||||||||||||||
Number of shares (excl. treasury shares), average
|
Million
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69.6 | 69.5 | 69.6 | 69.6 | 69.6 |
*)
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Gains/losses from sale of vessels and the mark-to-market adjustments of 'Other financial assets' are not annualized when calculating the return on equity.
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**)
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Gains/losses from sale of vessels are not annualized when calculating the Return on Invested Capital.
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Announcement no. 30 / 21 August 2012
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Second quarter report 2012
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Page 2 of 21
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Million USD
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Q2 2012
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Q1-Q2 2012
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||||||
Tanker
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Bulk
|
Not
|
Tanker
|
Bulk
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Not
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|||
Division
|
Division
|
allocated
|
Total
|
Division
|
Division
|
allocated
|
Total
|
|
Revenue
|
232.6
|
39.7
|
0.0
|
272.3
|
484.0
|
98.9
|
0.0
|
582.9
|
Port expenses, bunkers and commissions
|
-137.0
|
-24.6
|
0.0
|
-161.6
|
-275.7
|
-58.1
|
0.0
|
-333.8
|
Freight and bunkers derivatives
|
-0.1
|
-8.0
|
0.0
|
-8.1
|
-0.5
|
6.0
|
0.0
|
5.5
|
Time charter equivalent earnings
|
95.5
|
7.1
|
0.0
|
102.6
|
207.8
|
46.8
|
0.0
|
254.6
|
Charter hire
|
-43.7
|
-16.9
|
0.0
|
-60.6
|
-94.9
|
-50.1
|
0.0
|
-145.0
|
Operating expenses
|
-40.4
|
-1.0
|
0.0
|
-41.4
|
-80.0
|
-1.7
|
0.0
|
-81.7
|
Gross profit (Net earnings from shipping activities)
|
11.4
|
-10.8
|
0.0
|
0.6
|
32.9
|
-5.0
|
0.0
|
27.9
|
Profit from sale of vessels
|
0.0
|
0.0
|
0.0
|
0.0
|
-15.9
|
0.0
|
0.0
|
-15.9
|
Administrative expenses
|
-14.8
|
-1.7
|
0.0
|
-16.5
|
-29.7
|
-3.4
|
0.0
|
-33.1
|
Other operating income
|
0.3
|
0.1
|
0.0
|
0.4
|
0.8
|
0.1
|
0.0
|
0.9
|
Share of results of jointly controlled entities
|
-5.5
|
0.0
|
-1.9
|
-7.4
|
-5.4
|
0.0
|
-4.4
|
-9.8
|
EBITDA
|
-8.6
|
-12.4
|
-1.9
|
-22.9
|
-17.3
|
-8.3
|
-4.4
|
-30.0
|
Impairment losses on jointly controlled entities
|
0.0
|
0.0
|
-41.5
|
-41.5
|
0.0
|
0.0
|
-41.5
|
-41.5
|
Amortizations and depreciation
|
-33.5
|
-0.6
|
0.0
|
-34.1
|
-66.8
|
-1.3
|
0.0
|
-68.1
|
Operating profit (EBIT)
|
-42.1
|
-13.0
|
-43.4
|
-98.5
|
-84.1
|
-9.6
|
-45.9
|
-139.6
|
Financial income
|
-
|
-
|
3.2
|
3.2
|
-
|
-
|
6.8
|
6.8
|
Financial expenses
|
-
|
-
|
-36.8
|
-36.8
|
-
|
-
|
-77.8
|
-77.8
|
Profit/(loss) before tax
|
-
|
-
|
-77.0
|
-132.1
|
-
|
-
|
-116.9
|
-210.6
|
Tax
|
-
|
-
|
0.0
|
0.0
|
-
|
-
|
-0.2
|
-0.2
|
Net profit/(loss) for the period
|
-
|
-
|
-77.0
|
-132.1
|
-
|
-
|
-117.1
|
-210.8
|
Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
|
Page 3 of 21
|
2012
|
2013
|
2014
|
2012
|
2013
|
2014
|
|||||||||||||||||||
Owned days
|
||||||||||||||||||||||||
LR2
|
1,600 | 3,187 | 3,267 | |||||||||||||||||||||
LR1
|
1,281 | 2,509 | 2,509 | |||||||||||||||||||||
MR
|
7,069 | 13,997 | 14,075 | |||||||||||||||||||||
Handy size
|
2,013 | 3,975 | 3,944 | |||||||||||||||||||||
Tanker Division
|
11,963 | 23,667 | 23,795 | |||||||||||||||||||||
Panamax
|
364 | 726 | 694 | |||||||||||||||||||||
Handymax
|
- | - | - | |||||||||||||||||||||
Bulk Division
|
364 | 726 | 694 | |||||||||||||||||||||
Total
|
12,326 | 24,393 | 24,489 |
T/C in days |
T/C in costs (USD/day)
|
|||||||||||||||||||||||
LR2
|
366 | 726 | 725 | 20,733 | 20,729 | 20,916 | ||||||||||||||||||
LR1
|
2,009 | 2,979 | 2,210 | 22,387 | 23,881 | 24,000 | ||||||||||||||||||
MR
|
1,830 | 3,590 | 3,267 | 13,643 | 13,905 | 14,135 | ||||||||||||||||||
Handy size
|
- | - | - | - | - | - | ||||||||||||||||||
Tanker Division
|
4,205 | 7,295 | 6,202 | 18,437 | 18,658 | 18,443 | ||||||||||||||||||
Panamax
|
1,465 | 2,690 | 3,046 | 16,050 | 16,231 | 16,157 | ||||||||||||||||||
Handymax
|
307 | 363 | 363 | 15,827 | 15,995 | 15,995 | ||||||||||||||||||
Bulk Division
|
1,772 | 3,053 | 3,409 | 16,011 | 16,203 | 16,140 | ||||||||||||||||||
Total
|
5,977 | 10,348 | 9,611 | 17,718 | 17,934 | 17,626 | ||||||||||||||||||
Total physical days | Covered days | |||||||||||||||||||||||
LR2
|
1,966 | 3,913 | 3,992 | 216 | 278 | 225 | ||||||||||||||||||
LR1
|
3,290 | 5,488 | 4,719 | 534 | 365 | 175 | ||||||||||||||||||
MR
|
8,899 | 17,587 | 17,342 | 1,182 | 743 | - | ||||||||||||||||||
Handy size
|
2,013 | 3,975 | 3,944 | 54 | - | - | ||||||||||||||||||
Tanker Division
|
16,168 | 30,962 | 29,997 | 1,985 | 1,386 | 400 | ||||||||||||||||||
Panamax
|
1,829 | 3,416 | 3,740 | 1,843 | 79 | - | ||||||||||||||||||
Handymax
|
307 | 363 | 363 | 693 | 948 | 869 | ||||||||||||||||||
Bulk Division
|
2,136 | 3,779 | 4,103 | 2,536 | 1,027 | 869 | ||||||||||||||||||
Total
|
18,303 | 34,741 | 34,100 | 4,521 | 2,413 | 1,269 | ||||||||||||||||||
Covered % |
Coverage rates (USD/day)
|
|||||||||||||||||||||||
LR2
|
11 | % | 7 | % | 6 | % | 14,838 | 17,005 | 17,099 | |||||||||||||||
LR1
|
16 | % | 7 | % | 4 | % | 15,109 | 15,666 | 15,666 | |||||||||||||||
MR
|
13 | % | 4 | % | 0 | % | 13,911 | 13,932 | - | |||||||||||||||
Handy size
|
3 | % | 0 | % | 0 | % | 12,681 | - | - | |||||||||||||||
Tanker Division
|
12 | % | 4 | % | 1 | % | 14,300 | 15,005 | 16,472 | |||||||||||||||
Panamax
|
101 | % | 2 | % | 0 | % | 12,209 | 18,065 | - | |||||||||||||||
Handymax
|
226 | % | 261 | % | 239 | % | 11,983 | 17,403 | 17,644 | |||||||||||||||
Bulk Division
|
119 | % | 27 | % | 21 | % | 12,148 | 17,454 | 17,644 | |||||||||||||||
Total
|
25 | % | 7 | % | 4 | % | 13,093 | 16,047 | 17,275 |
Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
|
Page 4 of 21
|
Tanker Division
|
Q2 11
|
Q3 11
|
Q4 11
|
Q1 12
|
Q2 12
|
Change Q2 11
-Q2 12
|
12 month
avg.
|
|||||||||||||||||||||
LR2 (Aframax, 90-110,000 DWT)
|
||||||||||||||||||||||||||||
Available earning days
|
1,153 | 1,158 | 1,092 | 899 | 854 | -26 | % | |||||||||||||||||||||
Spot rates1)
|
10,612 | 10,836 | 11,959 | 10,814 | 10,206 | -4 | % | |||||||||||||||||||||
TCE per earning day2)
|
12,542 | 12,423 | 15,647 | 7,865 | 14,157 | 13 | % | 12,649 | ||||||||||||||||||||
Operating days
|
1,183 | 1,196 | 1,121 | 1,001 | 1,001 | -15 | % | |||||||||||||||||||||
Operating expenses per operating day3)
|
5,781 | 6,721 | 6,133 | 5,976 | 7,001 | 21 | % | 6,458 | ||||||||||||||||||||
LR1 (Panamax 75-85,000 DWT)
|
||||||||||||||||||||||||||||
Available earning days
|
2,164 | 2,208 | 2,081 | 2,076 | 1,879 | -13 | % | |||||||||||||||||||||
Spot rates1)
|
15,174 | 9,841 | 7,678 | 12,515 | 11,237 | -26 | % | |||||||||||||||||||||
TCE per earning day2)
|
14,962 | 9,467 | 9,020 | 12,977 | 11,747 | -21 | % | 10,758 | ||||||||||||||||||||
Operating days
|
637 | 644 | 644 | 637 | 637 | 0 | % | |||||||||||||||||||||
Operating expenses per operating day3)
|
6,135 | 6,481 | 6,419 | 6,389 | 5,798 | -5 | % | 6,272 | ||||||||||||||||||||
MR (45,000 DWT)
|
||||||||||||||||||||||||||||
Available earning days
|
4,373 | 4,511 | 4,477 | 4,681 | 4,362 | 0 | % | |||||||||||||||||||||
Spot rates1)
|
15,315 | 11,749 | 14,080 | 14,363 | 11,510 | -25 | % | |||||||||||||||||||||
TCE per earning day2)
|
15,867 | 12,910 | 13,335 | 14,082 | 11,418 | -28 | % | 12,959 | ||||||||||||||||||||
Operating days
|
3,549 | 3,496 | 3,496 | 3,557 | 3,549 | 0 | % | |||||||||||||||||||||
Operating expenses per operating day3)
|
6,629 | 6,732 | 5,929 | 6,743 | 6,756 | 2 | % | 6,540 | ||||||||||||||||||||
Handysize (35,000 DWT)
|
||||||||||||||||||||||||||||
Available earning days
|
996 | 992 | 978 | 989 | 981 | -2 | % | |||||||||||||||||||||
Spot rates1)
|
13,403 | 10,582 | 9,483 | 12,823 | 10,939 | -18 | % | |||||||||||||||||||||
TCE per earning day2)
|
11,983 | 12,020 | 9,809 | 13,122 | 12,189 | 2 | % | 11,790 | ||||||||||||||||||||
Operating days
|
1,001 | 1,012 | 1,012 | 1,001 | 1,001 | 0 | % | |||||||||||||||||||||
Operating expenses per operating day3)
|
5,183 | 5,436 | 6,919 | 5,577 | 5,686 | 10 | % | 5,904 |
Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
|
Page 5 of 21
|
Bulk Division
|
Q2 11
|
Q3 11
|
Q4 11
|
Q1 12
|
Q2 12
|
Change
|
12 month
|
Q2 11
|
avg.
|
||||||
- Q2 12
|
|||||||
Panamax (60-80,000 DWT)
|
|||||||
Available earning days
|
2,068
|
2,279
|
3,127
|
1,848
|
1,447
|
-30%
|
|
TCE per earning day2)
|
16,015
|
12,140
|
14,357
|
9,670
|
9,647
|
-40%
|
11,998
|
Operating days
|
182
|
184
|
184
|
182
|
182
|
0%
|
|
Operating expenses per operating day3)
|
3,904
|
5,126
|
3,896
|
3,934
|
5,130
|
31%
|
4,522
|
Handymax (40-55,000 DWT)
|
|||||||
Available earning days
|
1,133
|
1,152
|
1,361
|
642
|
260
|
-77%
|
|
TCE per earning day2)
|
12,554
|
12,510
|
13,403
|
11,763
|
4,353
|
-65%
|
12,105
|
Operating days
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Operating expenses per operating day3)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Announcement no. 30 / 21 August 2012
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Second quarter report 2012
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Page 6 of 21
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# of vessels
|
Current fleet
|
Newbuildings and T/C-in deliveries
with a period >= 12 months
|
|||||
Q1 2012
|
Changes
|
Q2 2012
|
2012
|
2013
|
2014
|
2015
|
|
Owned vessels
|
|||||||
LR2
|
9.0
|
-
|
9.0
|
||||
LR1
|
7.5
|
-0.5
|
7.0
|
||||
MR
|
39.0
|
-
|
39.0
|
||||
Handysize
|
11.0
|
-
|
11.0
|
||||
Tanker Division
|
66.5
|
-0.5
|
66.0
|
-
|
-
|
-
|
-
|
Panamax
|
2.0
|
-
|
2.0
|
||||
Handymax
|
-
|
-
|
|||||
Bulk Division
|
2.0
|
-
|
2.0
|
-
|
-
|
-
|
-
|
Total
|
68.5
|
-0.5
|
68.0
|
-
|
-
|
-
|
-
|
T/C-in vessels with contract period >= 12 months
|
|||||||
LR2
|
2.0
|
-
|
2.0
|
||||
LR1
|
16.0
|
-3.0
|
13.0
|
||||
MR
|
12.0
|
-2.0
|
10.0
|
||||
Handysize
|
-
|
-
|
|||||
Tanker Division
|
30.0
|
-5.0
|
25.0
|
-
|
-
|
-
|
-
|
Panamax
|
11.0
|
-2.0
|
9.0
|
1.0
|
1.0
|
2.0
|
|
Handymax
|
2.0
|
-
|
2.0
|
||||
Bulk Division
|
13.0
|
-2.0
|
11.0
|
1.0
|
1.0
|
2.0
|
-
|
Total
|
43.0
|
-7.0
|
36.0
|
1.0
|
1.0
|
2.0
|
-
|
T/C-in vessels with contract period < 12 months
|
|||||||
LR2
|
|||||||
LR1
|
|||||||
MR
|
|||||||
Handysize
|
|||||||
Tanker Division
|
-
|
-
|
-
|
||||
Panamax
|
3.0
|
-
|
3.0
|
||||
Handymax
|
2.0
|
-
|
2.0
|
||||
Bulk Division
|
5.0
|
-
|
5.0
|
||||
Total
|
5.0
|
-
|
5.0
|
||||
Pools/commecial management
|
20.0
|
-2.0
|
18.0
|
||||
Total fleet
|
136.5
|
-9.5
|
127.0
|
Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
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Page 7 of 21
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Notes on the financial reporting
|
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Accounting policies
|
||
The interim report for the period 1 January – 30 June 2012 is presented in accordance with IAS 34 "Interim Financial Reporting" as adopted by the EU and additional Danish disclosure requirements for interim reports of listed companies. The interim report has been prepared using the accounting policies as for the Annual Report for 2011. The accounting policies are described in more detail in the Annual Report for 2011. As from 1 January 2012, TORM has implemented the amendment to IFRS 7 regarding disclosures about transfer of financial assets. The amended standard has not affected recognition and measurement in TORM's interim report for the first half of 2012. The interim report of the second quarter of 2012 is unaudited, in line with the normal practice.
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Income statement
|
||
The gross profit for the second quarter of 2012 was USD 1 million, compared to USD 39 million for the corresponding period in 2011.
The second quarter of 2012 was not impacted by gains from sale of vessels, whereas the second quarter of 2011 had a gain of USD 7 million from sale of vessels. Administrative costs in the second quarter of 2012 were USD 17 million, compared to USD 18 million in the second quarter of 2011.
The result before depreciation (EBITDA) for the second quarter of 2012 was a loss of USD 23 million, compared to a profit of USD 30 million for the corresponding period of 2011. Loss from sales of vessels constituted USD 5 million in the second quarter of 2012, which is booked under results from jointly controlled entities.
Impairment losses on jointly controlled entities (FR8) constituted USD 42 million for the second quarter of 2012, subsequently the book value is set to USD 0 million. In comparison, there was no impairment in the second quarter of 2011.
Depreciation in the second quarter of 2012 was USD 34 million, USD 3 million lower than the second quarter of 2011. This decrease was due to vessel sales during first half of 2012.
The primary operating result for the second quarter of 2012 was a loss of USD 99 million, compared to a loss of USD 7 million in the same quarter of 2011.
The second quarter of 2012 was negatively impacted by mark-to-market non-cash adjustments of USD 8 million in total: Negative USD 11 million in connection with FFA/bunker derivatives and the positive net effect from other financial derivatives amounting to USD 3 million. The second quarter of 2011 had positive mark-to-market non-cash adjustments of USD 2 million.
Financial expenses of USD 37 million include USD 18 million in restructuring costs – primarily fees to advisors of the Company and the Company's creditors related to the work on a restructuring agreement.
The result after tax was a loss of USD 132 million in the second quarter of 2012, as against a loss of USD 24 million in the second quarter of 2011.
|
||
Assets
|
||
Total assets were down from USD 2,779 million as at 31 December 2011 to USD 2,544 million as at 30 June 2012. The book value of the fleet excluding financial lease vessels as of 30 June 2012 was USD 2,193 million. Based on broker valuations, TORM's fleet excluding financial lease vessels had a market value of USD 1,370 million as of 30 June 2012. TORM estimates the fleet's total long-term earning potential each quarter based on future discounted cash flows. The estimated value for the fleet as at 30 June 2012 supports the book value.
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Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
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Page 8 of 21
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Debt
|
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Net interest-bearing debt was USD 1,852 million as at 30 June 2012, compared to USD 1,838 million as at 31 March 2012. As at 30 June 2012, TORM was in breach of its financial covenants under the existing loan agreements. As at 30 June 2012, TORM did not have a standstill agreement with the bank group and therefore the Company no longer has the right to defer payments until such time as the final restructuring agreement has been entered into.
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Equity
|
|
Equity declined in the second quarter of 2012 from USD 569 million as at 31 March 2012 to USD 435 million primarily due to the loss during the period. Equity as a percentage of total assets was 17% as at 30 June 2012, compared to 23% as at 31 December 2011.
TORM held 3,230,432 treasury shares as at 30 June 2012, equivalent to 4.4% of the Company's share capital. This is the same level as of 31 March 2012.
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Liquidity
|
|
TORM had cash of USD 17 million at the end of the second quarter of 2012 and no credit lines available. TORM has no order book and therefore no CAPEX related hereto. As at 20 August 2012 the cash totalled USD 33 million.
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Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
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Page 9 of 21
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Executive Management
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Board of Directors
|
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Jacob Meldgaard, CEO
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Niels Erik Nielsen, Chairman
|
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Roland M. Andersen, CFO
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Christian Frigast, Deputy Chairman
|
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Jesper Jarlbæk
|
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Kari Millum Gardarnar
|
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Rasmus Johannes Hoffmann
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Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
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Page 10 of 21
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Million USD
|
Q2 2012 | Q2 2011 | Q1-Q2 2012 | Q1-Q2 2011 | 2011 | |||||||||||||||
Revenue
|
272.3 | 335.7 | 582.9 | 606.1 | 1,305.2 | |||||||||||||||
Port expenses, bunkers and commissions
|
-161.6 | -159.9 | -333.8 | -289.7 | -675.0 | |||||||||||||||
Freight and bunkers derivatives
|
-8.1 | 3.0 | 5.5 | 9.9 | 14.1 | |||||||||||||||
Time charter equivalent earnings
|
102.6 | 178.8 | 254.6 | 326.3 | 644.3 | |||||||||||||||
Charter hire
|
-60.6 | -99.6 | -145.0 | -176.2 | -398.3 | |||||||||||||||
Operating expenses
|
-41.4 | -40.1 | -81.7 | -83.2 | -165.0 | |||||||||||||||
Gross profit (Net earnings from shipping activities)
|
0.6 | 39.1 | 27.9 | 66.9 | 81.0 | |||||||||||||||
Profit from sale of vessels
|
0.0 | 7.1 | -15.9 | 1.4 | -52.6 | |||||||||||||||
Administrative expenses
|
-16.5 | -17.7 | -33.1 | -34.8 | -71.2 | |||||||||||||||
Other operating income
|
0.4 | 2.3 | 0.9 | 2.5 | 3.2 | |||||||||||||||
Share of results of jointly controlled entities
|
-7.4 | -1.3 | -9.8 | -2.4 | -4.2 | |||||||||||||||
EBITDA
|
-22.9 | 29.5 | -30.0 | 33.6 | -43.8 | |||||||||||||||
Impairment losses on jointly controlled entities
|
-41.5 | 0.0 | -41.5 | 0.0 | -13.0 | |||||||||||||||
Impairment losses on tangible and intangible assets
|
0.0 | 0.0 | 0.0 | 0.0 | -187.0 | |||||||||||||||
Amortizations and depreciation
|
-34.1 | -36.5 | -68.1 | -73.1 | -144.8 | |||||||||||||||
Operating profit (EBIT)
|
-98.5 | -7.0 | -139.6 | -39.5 | -388.6 | |||||||||||||||
Financial income
|
3.2 | -0.5 | 6.8 | 2.0 | 9.9 | |||||||||||||||
Financial expenses
|
-36.8 | -16.2 | -77.8 | -31.1 | -72.7 | |||||||||||||||
Profit/(loss) before tax
|
-132.1 | -23.7 | -210.6 | -68.6 | -451.4 | |||||||||||||||
Tax
|
0.0 | -0.6 | -0.2 | -1.0 | -1.6 | |||||||||||||||
Net profit/(loss) for the period
|
-132.1 | -24.3 | -210.8 | -69.6 | -453.0 | |||||||||||||||
Earnings/(loss) per share, EPS
|
||||||||||||||||||||
Earnings/(loss) per share, EPS (USD)
|
-1.9 | -0.3 | -3.0 | -1.0 | -6.5 | |||||||||||||||
Earnings/(loss) per share, EPS (DKK)*
|
-11.0 | -1.8 | -17.4 | -5.3 | -34.9 | |||||||||||||||
Diluted earnings/(loss) per share, (USD)
|
-1.9 | -0.3 | -3.0 | -1.0 | -6.5 | |||||||||||||||
Diluted earnings/(loss) per share, (DKK)*
|
-11.0 | -1.8 | -17.4 | -5.3 | -34.9 |
Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
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Page 11 of 21
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Million USD
|
Q2 12 | Q1 12 | Q4 11 | Q3 11 | Q2 11 | |||||||||||||||
Revenue
|
272.3 | 310.6 | 367.3 | 331.8 | 335.7 | |||||||||||||||
Port expenses, bunkers and commissions
|
-161.6 | -172.2 | -202.5 | -182.8 | -159.9 | |||||||||||||||
Freight and bunkers derivatives
|
-8.1 | 13.6 | 5.1 | -0.9 | 3.0 | |||||||||||||||
Time charter equivalent earnings
|
102.6 | 152.0 | 169.9 | 148.1 | 178.8 | |||||||||||||||
Charter hire
|
-60.6 | -84.4 | -118.6 | -103.5 | -99.6 | |||||||||||||||
Operating expenses
|
-41.4 | -40.3 | -39.5 | -42.3 | -40.1 | |||||||||||||||
Gross profit (Net earnings from shipping activities)
|
0.6 | 27.3 | 11.8 | 2.3 | 39.1 | |||||||||||||||
Profit from sale of vessels
|
0.0 | -15.9 | -54.0 | 0.0 | 7.1 | |||||||||||||||
Administrative expenses
|
-16.5 | -16.6 | -19.6 | -16.8 | -17.7 | |||||||||||||||
Other operating income
|
0.4 | 0.5 | 0.3 | 0.4 | 2.3 | |||||||||||||||
Share of results of jointly controlled entities
|
-7.4 | -2.4 | 1.1 | -2.9 | -1.3 | |||||||||||||||
EBITDA
|
-22.9 | -7.1 | -60.4 | -17.0 | 29.5 | |||||||||||||||
Impairment losses on jointly controlled entities
|
-41.5 | 0.0 | -13.0 | 0.0 | 0.0 | |||||||||||||||
Impairment losses on tangible and intangible assets
|
0.0 | 0.0 | -187.0 | 0.0 | 0.0 | |||||||||||||||
Amortizations and depreciation
|
-34.1 | -34.0 | -35.6 | -36.1 | -36.5 | |||||||||||||||
Operating profit (EBIT)
|
-98.5 | -41.1 | -296.0 | -53.1 | -7.0 | |||||||||||||||
Financial income
|
3.2 | 3.6 | 8.4 | -0.5 | -0.5 | |||||||||||||||
Financial expenses
|
-36.8 | -41.0 | -25.1 | -16.5 | -16.2 | |||||||||||||||
Profit/(loss) before tax
|
-132.1 | -78.5 | -312.7 | -70.1 | -23.7 | |||||||||||||||
Tax
|
0.0 | -0.2 | -0.3 | -0.3 | -0.6 | |||||||||||||||
Net profit/(loss) for the period
|
-132.1 | -78.7 | -313.0 | -70.4 | -24.3 | |||||||||||||||
Earnings/(loss) per share, EPS
|
||||||||||||||||||||
Earnings/(loss) per share, EPS (USD)
|
-1.9 | -1.1 | -4.5 | -1.0 | -0.3 | |||||||||||||||
Diluted earnings/(loss) per share, (USD)
|
-1.9 | -1.1 | -4.5 | -1.0 | -0.3 |
Announcement no. 30 / 21 August 2012
|
Second quarter report 2012
|
Page 12 of 21
|
Million USD
|
Q2 2012 | Q2 2011 | Q1-Q2 2012 | Q1-Q2 2011 | 2011 | |||||||||||||||
Net profit/(loss) for the period
|
-132.1 | -24.3 | -210.8 | -69.6 | -453.0 | |||||||||||||||
Other comprehensive income:
|
||||||||||||||||||||
Exchange rate adjustment arising on translation
|
||||||||||||||||||||
of entities using a measurement currency different
|
||||||||||||||||||||
from USD
|
-0.4 | 0.0 | 0.3 | 0.0 | -0.4 | |||||||||||||||
Fair value adjustment on hedging instruments
|
-7.2 | -13.4 |