OSLO, Norway, March 3, 2003 (PRIMEZONE) -- Northern Offshore Ltd. (Other OTC:NOFSF):
Fourth Quarter and Financial Year 2002 Results
Northern Offshore Ltd. reports consolidated earnings before interest, tax, depreciation and amortisation (EBITDA) of USD 5.8 million for the fourth quarter 2002, down from USD 8.9 million in the third quarter. The main reason for the decrease is a provision of USD 2.1 million for a claim against the Company by INPEX relating to alleged damage caused by Energy Searcher on a drilling contract.
For the financial year 2002 Northern Offshore Ltd. reports consolidated EBITDA of USD 32.0 million compared to USD 25.4 million for the year 2001. The increase is mainly due to the inclusion of a full year's earnings from Energy Searcher, which was acquired in June 2001, together with improved day rates for Northern Producer.
We have reviewed our assets for impairment in accordance with US GAAP on an asset-by-asset basis. This review has resulted in a total write down of USD 21.6 million, which relates to two of our laid up rigs. This write down reflects a negative development in asset valuations in the drilling market over the last year and is based on third party open market valuations. Due to the lack of liquidity in the market for these types of asset, there is considerable uncertainty surrounding these valuations.
The net loss for the fourth quarter 2002 was USD 25.1 million compared to a net loss of USD 35.1 million for the same period in 2001. The difference is largely due to write downs of assets which amounted to USD 31.6 million in 2001 compared to USD 21.6 million in 2002 as discussed above.
The net loss for the full-year of USD 19.9 million compares to a net loss of USD 37.4 million in 2001. In addition to the developments discussed above, we achieved a reduction of USD 1.5 million in interest expense by repaying debt and there was a reduction of depreciation expense by USD 0.9 million due to writing down asset book values. The net loss for the year includes a credit of USD 6.1 million recorded as the cumulative effect of a change in accounting principle due to changing our accounting policy for drydocking costs from the accrual method to the expense as incurred method. The net loss for 2001 includes an extraordinary profit on repurchases of debt of USD 6.4m and the cumulative effect of a change in accounting principle of USD 0.7m resulting from the adoption of FAS 133.
The full report is enclosed on the following link: http://reports.huginonline.com/893914/114321.pdf