The Netherlands: Smit Internationale has reported a net profit of US$139.2 million compared with US$146.8 million in 2008.
EBITDA for the year was US$271.9 million (2008: 273.7 million), operating results for the year amounted to US$142.7 million (2008: US$153.2 million).
"Despite the world wide recession, which off course impacted our business, we continued to realise good financial results," Ben Vree, CEO of Smit commented.
"This result, however, has been influenced by the settlement of the 'Thunderhorse' project and a non-recurring tax benefit. During 2009 we noticed that the decline of the harbour towage market stabilised and at certain locations even improved slightly towards the end of the year.
" Terminal activities continued to grow substantially and provided stable income. Salvage remains unpredictable. The result was heavily influenced by the settlement of prior-year salvage jobs; as a result the division performed well."
Harbour towage division
Smit's harbour towage division reported a revenue of US$211.9 million compared with US$252.9 million the year before. Its operating results for the year were US$25 million compared with US$45.2 million.
Smit commented that the recession had a significant impact on revenues for the harbour towage division.
Particularly in Europe and Canada the number of ship movements decreased compared with last year. In order to keep profit margins on an acceptable level, a number of harbour tugs have been repositioned from existing operations to new ports. Harbour tugs, mainly from European ports, have been mobilised to joint venture companies that started new harbour towage services. In Taiwan the joint venture with Kueen Yang started harbour towage activities with five tugs in the port of Taipei at the beginning of 2009.
In the Baltic region the joint venture Towmar Smit Baltic was incorporated in May 2009 providing services in Lithuania and Latvia. Smit contributed three new harbour tugs into this joint venture.
Furthermore the synergies with the terminals division were optimised by transferring six harbour tugs to new terminal contracts in locations such as India and Indonesia.
The result from associated companies grew sharply compared with last year. The joint venture Rebras completed its new building programme of 18 tugs during 2009 and currently 21 tugs are operational at five different locations in Brazil. The impact of the recession on the joint ventures in Asia was less than in other regions due to the focus on oil-related activities.
During the fourth quarter of 2009 Smit was awarded a five-year concession for the provision of harbour towage services in the Port of Gladstone, Australia. The operations will start on January 1, 2011, with six new tugs.
Just before the end of the year the acquisition of 100 percent of the shares of Minette Bay Ship Docking was finalised. This company operates three harbour tugs in Prince Rupert, Canada and will be integrated into the existing Smit activities on Canada's West Coast.
Despite the current recession the harbour towage market is considered as being stable. Smit set itself the target of increasing the net result in this division by 50 percent over the coming five years (starting 2007) by means of acquisitions, expansion of activities and fleet expansions.
Terminals division
The terminals division reported a revenue of US$132.8 million compared with US$96 million the year before, giving the division an operating result of US$24.6 million compared with US$14.7 million.
During 2009 terminals realised a sharp profit growth. On the one hand this growth is a result of the new contracts that started in the second half of 2008 and contributed for a full year in 2009 such as the operations in Kuwait and Pakistan. On the other hand the profit increase is caused by the contracts which started in 2009. In the third quarter of 2009 the 25 year contract for the LNG terminal in Italy commenced with four tugs through a joint venture company.
Two smaller contracts commenced in India and Gabon during the second half of the year and the existing contract in the Bahamas was extended with an additional tug. Furthermore during 2009 a so called "frontrunner" contract in Indonesia contributed to the result, using four tugs from the harbour towage division. The current terminal contract in Novorossiysk (Russia) will not be renewed and will be terminated mid-2010.
The growth target for net profit is 100 percent over a five-year period (starting 2007).
Salvage division
Smit's salvage division posted a revenue of US$127.3 million compared with US$158.9 million the year before, giving the company an operating result of US$37.5 million compared with US$22.7 million in 2008.
According to the company, the work load for the salvage division was below the historical average due to fewer casualties during 2009.
The profit for the year 2009, however, is at a very high level due to the settlement of prior year salvage cases which generated additional salvage income.
The main settlement relates to the "Thunderhorse" project (Gulf of Mexico, 2005) with an impact of US$13.6 million on net profit.
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