EURONAV NV Thursday 26 January 2017 - 6 a.m. CET
EURONAV ANNOUNCES FOURTH QUARTER RESULTS 2016 HIGHLIGHTSMuted Q4 freight rate performance from extended seasonal weakness
Encouraging start for Q1 but confluence of factors likely to impact from February
Euronav balance sheet bolstered by sale & leaseback and new financing facility
Letter of award for FSO for five-year contract starting Q3 2017
Return to shareholders' policy confirmed
ANTWERP, Belgium, 26 January 2017 - Euronav NV (NYSE: EURN & Euronext: EURN) ("Euronav" or the "Company") today reported its non-audited financial results for the three months ended 31 December 2016.
Paddy Rodgers, CEO of Euronav said: "Euronav had an active Q4 resulting in a letter of award for our FSO joint venture for a five-year contract, refinancing over USD 400 million of company debt on better terms and duration plus executing a sale and leaseback on four vessels. This has further bolstered our already strong balance sheet and gives us the flexibility to navigate the tanker sector cycle from a position of strength.
Tanker owner sentiment and behavior continues to be relatively brittle despite medium- term positive market fundamentals. Freight rates in what historically is the strongest quarter in any calendar year - Q4 - were subdued. Since November, however, record cargo volumes ahead of OPEC production cuts, caused by improving demand for crude, helped drive rates toward long-term Q4 averages in December. However, 2017 will, in our view, present a number of challenges: OPEC production cuts, peak delivery schedule of the order book, continued restricted access to finance and anemic owner confidence, which when combined, are all likely to produce a difficult rate environment for 2017".
PRESS RELEASE Regulated informationThursday 26 January 2017 - 6 a.m. CET
The most important key figures (unaudited) are: | ||||||||
(in thousands of USD) | Fourth Quarter 2016 | Fourth Quarter 2015 | Full Year 2016 | Full Year 2015 | ||||
Revenue | 146,280 | 225,644 | 684,265 | 846,507 | ||||
Other operating income | 1,463 | 1,154 | 6,996 | 7,426 | ||||
Voyage expenses and commissions | (16,481) | (15,956) | (59,560) | (71,237) | ||||
Vessel operating expenses | (37,361) | (38,812) | (160,199) | (153,718) | ||||
Charter hire expenses | (2,920) | (6,438) | (17,713) | (25,849) | ||||
General and administrative expenses | (11,418) | (16,122) | (44,051) | (46,251) | ||||
Net gain (loss) on disposal of tangible assets | 36,576 | 11,165 | 50,395 | 5,300 | ||||
Net gain (loss) on disposal of investments in equity accounted investees | − | − | (24,150) | − | ||||
Depreciation | (59,125) | (54,896) | (227,709) | (210,206) | ||||
Net finance expenses | (16,095) | (9,799) | (44,849) | (47,630) | ||||
Share of profit (loss) of equity accounted investees | 8,637 | 13,520 | 40,194 | 51,592 | ||||
Result before taxation | 49,556 | 109,461 | 203,619 | 355,934 | ||||
Tax benefit (expense) | 475 | (4,602) | 174 | (5,633) | ||||
Profit (loss) for the period | 50,031 | 104,859 | 203,793 | 350,301 | ||||
Attributable to: Owners of the company | 50,031 | 104,859 | 203,793 | 350,301 | ||||
The contribution to the result is as follows: | ||||||||
(in thousands of USD) | Fourth Quarter 2016 | Fourth Quarter 2015 | Full Year 2016 | Full Year 2015 | ||||
Tankers | 41,630 | 96,697 | 169,324 | 317,347 | ||||
FSO | 8,401 | 8,162 | 34,469 | 32,954 | ||||
Result after taxation | 50,031 | 104,859 | 203,793 | 350,301 | ||||
Information per share: | ||||||||
(in USD per share) | Fourth Quarter 2016 | Fourth Quarter 2015 | Full Year 2016 | Full Year 2015 | ||||
Weighted average number of shares (basic) * | 158,166,534 | 158,628,151 | 158,262,268 | 155,872,171 | ||||
Result after taxation | 0.32 | 0.66 | 1.29 | 2.25 | ||||
* The number of shares issued on 31 December 2016 is 159,208,949. | ||||||||
Thursday 26 January 2017 - 6 a.m. CET
EBITDA reconciliation (unaudited): | ||||||||
(in thousands of USD) | Fourth Quarter 2016 | Fourth Quarter 2015 | Full Year 2016 | Full Year 2015 | ||||
Profit (loss) for the period | 50,031 | 104,859 | 203,793 | 350,301 | ||||
+ Depreciation | 59,125 | 54,896 | 227,709 | 210,206 | ||||
+ Net finance expenses | 16,095 | 9,799 | 44,849 | 47,630 | ||||
+ Tax expense (benefit) | (475) | 4,602 | (174) | 5,633 | ||||
EBITDA | 124,776 | 174,156 | 476,177 | 613,770 | ||||
+ Depreciation equity accounted investees | 4,776 | 7,428 | 23,774 | 29,314 | ||||
+ Net finance expenses equity accounted investees | 521 | 966 | 3,212 | 5,288 | ||||
+ Tax expense (benefit) equity accounted investees | 66 | (184) | 182 | (184) | ||||
Proportionate EBITDA | 130,139 | 182,366 | 503,345 | 648,188 | ||||
Proportionate EBITDA per share: | ||||||||
(in USD per share) | Fourth Quarter 2016 | Fourth Quarter 2015 | Full Year 2016 | Full Year 2015 | ||||
Weighted average number of shares (basic) * | 158,166,534 | 158,628,151 | 158,262,268 | 155,872,171 | ||||
Proportionate EBITDA | 0.82 | 1.15 | 3.18 | 4.16 | ||||
All figures have been prepared under IFRS as adopted by the EU (International Financial Reporting Standards) and have not been audited nor reviewed by the statutory auditor. | ||||||||
For the fourth quarter of 2016 the Company had a net profit of USD 50.0 million (fourth quarter 2015: USD 104.9 million) or USD 0.32 per share (fourth quarter 2015: USD 0.66 per share). Proportionate EBITDA (a non-IFRS measure) for the same period was USD
130.1 million (fourth quarter 2015: USD 182.4 million).
The average daily time charter equivalent rates (TCE, a non IFRS-measure) can be summarized as follows:
In USD per day | Fourth quarter 2016 | Fourth quarter 2015 | Full year 2016 | Full year 2015 |
VLCC | ||||
Average spot rate (in TI pool) | 33,161 | 61,482 | 41,863 | 55,055 |
Average time charter rate | 43,833 | 41,776 | 42,618 | 41,981 |
SUEZMAX | ||||
Average spot rate | 21,243 | 41,596 | 27,498 | 41,686 |
Average time charter rate | 24,662 | 36,042 | 26,269 | 35,790 |
Including profit share where applicable Excluding technical offhire days
PRESS RELEASE Regulated informationThursday 26 January 2017 - 6 a.m. CET
EURONAV TANKER FLEETOn 3 October 2016 Euronav signed two long-term time charter contracts of seven years each starting in 2018 with Valero Energy Inc. for Suezmax vessels with specialized Ice Class 1C capability. In order to fulfil these contracts, Euronav has ordered two high specification Ice Class Suezmax vessels from Hyundai Heavy Industries shipyard in South Korea. Delivery of these vessels is expected in early 2018 in good time for commencement of the charters.
On 13 October 2016 Euronav agreed with Hyundai Heavy Industries shipyard in South Korea to defer the delivery of the two VLCC ex-yard resale vessels, it recently purchased, to the first quarter of 2017. These vessels, previously expected to be delivered between October and November 2016, were delivered in January 2017.
On 27 October 2016 the VLCC KHK Vision (2007 - 305,749 dwt) which was time chartered in, was redelivered to its owner.
On 16 December 2016 Euronav signed a new USD 410 million senior secured amortizing revolving credit facility for the purpose of refinancing 11 vessels as well as Euronav's general corporate purposes. The credit facility was used to refinance the USD 500 million senior secured credit facility dated 25 March 2014 and will mature on 31 January 2023 carrying a rate of LIBOR plus a margin of 2.25%.
On 22 December 2016 together with joint venture partner International Seaways, Inc. ("INSW"), Euronav received a letter of award for a five-year contract for the service of its two FSO units. The existing contracts will remain in force until expiry in Q3. If negotiations and documentation are successfully concluded, the new contracts are expected to generate revenues for the joint venture in excess of USD 360 million over their full duration, excluding reimbursement for agreed operating expenses. The signing of final services contracts remains subject to an agreement on substantive business terms and no assurance can be given that such agreement will be reached.
On 22 December 2016 Euronav entered into a five-year sale and leaseback agreement for four VLCC vessels with investment vehicles advised by Wafra Capital Partners Inc., a private equity partnership. The four VLCCs are the Nautilus (2006 - 307,284 dwt), Navarin (2007 - 307,284 dwt), Neptun (2007 - 307,284 dwt) and Nucleus (2007 - 307,284 dwt). The terms of the transaction include an aggregate sales price of USD 186 million, resulting in a capital gain of USD 36.5 million. The leaseback transaction is accounted for as an operating lease under IFRS and includes certain contingent elements linked to the fair market value of the vessels during and at the expiry of the charter period. As per our return to shareholders' policy, this capital gain will not be eligible for dividend distribution. After repayment of the existing debt, the transaction generated in excess of USD 100 million free cash. Euronav has leased back the four vessels, which were built by Dalian Shipbuilding Industry Co., Ltd. (DSIC), under a five-year bareboat
Euronav NV published this content on 26 January 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 26 January 2017 05:12:09 UTC.
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