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Stolt-Nielsen S.A. (Nasdaq:SNSA) LONDON, July 3, 2008 - Stolt-Nielsen S.A. (Oslo Børs: SNI) today reported unaudited results for the second quarter ended May 31, 2008.
Highlights for the second quarter of 2008, compared with the first quarter of 2008, included:
* Operating profit of $52.2 million, compared with $54.6 million. * The Stolt Tankers Joint Service Sailed-in Time-Charter Index[1] decreased to 1.27 from 1.29 in the first quarter and from 1.38 in the second quarter a year ago. * Stolt Tankers reported healthy demand, though profits continued to be impacted by increased bunker-fuel costs and ship-management costs. * Stolthaven Terminals reported growth in operating profit, reflecting continued strong demand at its owned and joint-venture terminals worldwide. * Stolt Tank Containers reported higher revenues from strong global demand, though operating profit remained under pressure due to rising ocean freight, trucking and cleaning costs. * Stolt Sea Farm's revenues declined due to normal seasonal factors, while operating profit rose as a result of the positive impact of a net $1.3 million IFRS fair value revaluation of Stolt Sea Farm inventories. * During the quarter four ships were sold-three for recycling-resulting in a book gain of $7.2 million for the period.
Commenting on the Company's results, Mr. Niels G. Stolt-Nielsen, Chief Executive Officer of SNSA, said:
"Demand in all of SNSA's markets remained healthy in the second quarter, with good volumes on our global parcel-tanker tradelanes and continued high levels of utilization at both Stolthaven Terminals and Stolt Tank Containers. Second-quarter profits, however, were held down overall by escalating operating costs, driven primarily by higher fuel prices and a weaker U.S. dollar. The average price paid for bunkers increased to $550 per ton at the end of the second quarter from $495 per ton at the end of the first quarter.
Stolt Tankers' operating margin continued to decrease as a result of significant increases in our operating costs particularly bunkers, which we were not able to recover fast enough through surcharges and freight increases. We have not seen any significant changes in demand for our parcel-tanker services in the last quarter, despite the current weakness in some sectors of the global economy. Neither have we seen any impact on the market due to the increasing number of newbuildings being delivered.
Profit from continuing operations for the first half of 2008 was $83.1 million, up from $82.1 million in the first half of 2007.
We have secured financing for our series of six stainless steel newbuildings under construction at Aker Yards Florø in Norway, as well as the coated newbuildings under construction at SLS Shipyard in Korea that will enter our newly announced joint venture, Gulf Stolt Tankers FZCO. In addition, we are underway with the financing for our eight ship stainless steel newbuilding programme with SLS Shipyard in Korea."
[1] The Stolt Tankers Joint Service Sailed-in Time-Charter Index is an indexed measurement of the sailed-in rate for the Joint Service and was set at 1.00 in the first quarter of 1990 based on the average sailed-in time-charter result for the fleet at the time. The sailed-in rate is a measure frequently used by shipping companies, which subtracts from the ships' operating revenue the variable costs associated with a voyage, primarily commissions, sublets, transshipments, port costs, and bunker fuel.
