Summary
1. Half-year results
The unaudited net profit after tax for IHC Caland for the first six months of 2004 was US$ 53.8 million (US$ 1.65 per share) compared with US$ 34.2 million (US$ 1.07 per share) at mid-year 2003, and US$ 46.6 million (US$ 1.45 per share) for the whole of 2003.
EBITDA for the half-year was US$ 180.0 million (US$ 5.53 per share) compared with US$ 126.3 million (US$ 3.95 per share) at mid-year 2003, and US$ 219.2 million (US$ 6.82 per share) for the whole of 2003.
Net cash in hand plus securities at the end of June was US$ 185.9 million compared with US$ 167.3 million at the end of 2003.
2. Forecast for the full year 2004
Net income and cashflow guidance for 2004 was not provided at the beginning of the year due to uncertainties concerning the timing and manner of the Shipbuilding activities split-off, and the timing of major project awards in the Offshore division.
With the Shipbuilding sale process now well under way, and a clearer business picture in the Offshore, the Group expects that 2004 will generate:
The above assumes a full year's contribution from Shipbuilding although the Group's consolidated results will ultimately include Shipbuilding only up until the effective date of the sale expected during the 4th quarter 2004.
3. Split-off - Update
On 2 August 2004, the Group decided to proceed with the sale of the Shipbuilding division rather than to seek a separate listing. This decision was based upon several non-binding offers received from bidders who had been provided with the Information Memorandum.
A short list of bidders has been established, and each party is currently undertaking due diligence procedures. It is expected that the entire sale process will be completed during the 4th quarter 2004. Until such time no indication of the anticipated level of sales proceeds can be disclosed, except that the Group does not expect to receive net proceeds equal to the equity book value of the Shipbuilding division.
An extraordinary shareholders meeting will be convened during the fourth quarter to approve the sale proposal.
4. New booked orders
New booked orders for the first half-year of 2004 totalled US$ 415 million, compared with US$ 921 million for the first half of 2003, and US$ 1,392 million for the whole year 2003. Order portfolio at 30 June stood at US$ 4,490 million (year-end 2003 - US$ 4,760 million).
The major new orders include:
Major orders received after 30 June 2004:
The following major awards were received since 30 June 2004:
The total value of these orders received since July 1st, 2004 amounts to about US$ 440 million, of which US$ 340 million represent the orders for the Offshore division and US$ 100 million the orders for the Shipbuilding division.
5. Funding
The slow order intake in the Offshore division has reduced forecast capital expenditure in 2004 to less than half of the 2003 level. As previously stated, this means that the balance sheet position will improve considerably over the second half of 2004 as existing debt is paid down from the long term FPSO lease contracts, with limited need for new funding. The net debt to equity ratio at year-end 2004 is therefore expected to be below 1.50, the level at the end of 2003.
In this context the Group is still reluctant to issue any equity or equity related instrument except where demand for favourable FPSO lease and operate contracts should so require.
6. Market Developments
Offshore oil and gas
The Company has in the first half of the year been successful in securing a number of small and medium size orders for offshore terminal facilities and for the supply of a mooring system for an FPSO. However, neither major supply nor lease contracts were booked in that period, primarily caused by the very low bidding and contracting activity worldwide. This trend, felt already in 2003, persisted in the first half of 2004.
The first signs that the tide is turning are the orders obtained shortly after midyear, from GulfTerra for a semi-submersible hull for Atwater Valley and from Agip KCO for three flash gas compression barges for the Caspian Sea. The recovery is further illustrated by an increased tendering activity for leased FPSO's which should result in a number of awards for long-term FPSO lease contracts.
A number of projects for TLP's confirm this new development with Atlantia currently tendering for three dry tree units. These prospects give increased visibility for Atlantia's product line, which has been suffering from an absence of demand for more than two years.
Looking further ahead into 2005 we expect increased bidding activity of the oil majors, in particular in the deep and ultra deep water offshore West Africa and Brazil, with the oil companies focusing on medium size FPSO's on lease as well as sale basis.
Dredger and specialised shipbuilding
As stated previously, the increase in ordering activity by the major dredging contractors to replace their aging dredgers will only resume after the problems around the availability of Indonesian sand for the big Singapore reclamation projects are solved. This is not to be expected before the end of the fourth quarter. The demand from the state-owned dredging companies and other foreign private dredging contractors is still satisfactory and should, together with serious prospects in the specialised shipbuilding market such as for river cruise vessels, bring future new business before the end of the year.
7. Financial agenda
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Preliminary results 2004
Final results 2004 - Press release
Final results 2004 - Analysts Presentations (Amsterdam and London)
Annual Report 2004
Annual General Meeting of Shareholders 2005
Midyear figures 2005 - Press release
Midyear figures 2005 - Analysts Presentations (Amsterdam and London) |
31 January
4 April
5 April
Early May
20 May
29 August
30 August |
2005
2005
2005
2005
2005
2005
2005
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8. Corporate Profile
IHC Caland, supplier of equipment for the offshore oilfield service, dredging and shipping industries.
