”TORM posted a 2009 result in line with break-even expectations. High fleet
utilisation yielding above market earnings during the year combined with
substantial cost reductions contributed positively to earnings. In combination
with a fully funded order book the Company has improved its competitive
position further under difficult market conditions," TORM's CFO Roland M.
Andersen says.
• Profit before tax and extraordinary impairment loss totalled USD 1 million
which is in line with expectations. After an extraordinary impairment
write-down of USD 20 million relating to the Company's 50% stake in FR8, loss
before tax amounted to USD 19 million.
• In 2009, the Tanker Division's earnings were negatively impacted by the
global recession and the resulting decline in global oil consumption as well as
the influx of a high number of new vessels. Effective utilisation of TORM's
fleet in the second half secured earnings above the general market average.
• The sale and delivery of four bulk carriers affected profit before tax
positively by USD 33 million. The sale of two bulk carriers in November 2009 at
a total profit of USD 18 million will be taken to income in the first quarter
of 2010 upon delivery of the vessels.
• TORM's efficiency programme "Greater Efficiency Power" will in 2010, in line
with projections, reduce vessel operating costs by some 15% per vessel and
administrative expenses by some 20% compared to 2008. Annual cost savings will
materialise in the range of USD 50 million.
• In December 2009, TORM signed an agreement to finance six of the Company's MR
newbuildings in the amount of USD 167 million. The vessels are planned for
delivery between 2010 and 2012. After the balance sheet date, TORM signed an
additional agreement on 1 February 2010 to finance six other MR newbuildings in
the amount of USD 170 million. TORM's cash and unutilised loan facilities
hereafter amounted to USD 700 million.
• Remaining installments relating to TORM's order book as of 31 December 2009
amounted to USD 455 million, which is fully funded.
• As of 31 December 2009, equity amounted to USD 1,247 million (DKK 6,472
million), corresponding to USD 18 per share (DKK 93) excluding treasury shares,
giving TORM an equity ratio of 38.6%.
• TORM calculates the long-term earnings potential of its fleet based on
discounted expected future cash flows in accordance with IFRS. The calculated
value of the fleet as of 31 December 2009 supports book values.
• In 2009, TORM strengthened the Company's CSR strategy and defined ambitious
goals for reduction of CO2 emissions going forward. The Company signed the UN
Global Compact during 2009 and a global CSR organisation has been established.
• As of 31 December 2009, 31% of the earning days in the Tanker Division for
2010 had been covered at a rate of USD/day 18,989 and 71% of the earning days
in the Bulk Division at a rate of USD/day 18,100.
• As of 1 April 2010, Jacob Meldgaard will take over the position as CEO as
previously announced.
• For the full year 2010, TORM forecasts a loss before tax of USD 15-60
million. The outlook is subject to considerable uncertainty.
• The Board of Directors recommends, subject to approval at the Annual General
Meeting, that no dividend will be distributed for the year 2009.
Contact
TORM A/S
Tuborg Havnevej 18
DK-2900 Hellerup, Denmark
Telephone: +45 39 17 92 00
Mikael Skov, CEO
Roland M. Andersen, CFO
Safe harbour Statement Matters discussed in this release may constitute
forward-looking statements. Forward-looking statements reflect our current
views with respect to future events and financial performance and may include
statements concerning plans, objectives, goals, strategies, future events or
performance, and underlying assumptions and other statements, which are other
than statements of historical facts. The forward-looking statements in this
release are based upon various assumptions, many of which are based, in turn,
upon further assumptions, including without limitation, Management's
examination of historical operating trends, data contained in our records and
other data available from third parties. Although TORM believes that these
assumptions were reasonable when made, because these assumptions are inherently
subject to significant uncertainties and contingencies which are difficult or
impossible to predict and are beyond our control, TORM cannot assure you that
it will achieve or accomplish these expectations, beliefs or projections.
Important factors that, in our view, could cause actual results to differ
materially from those discussed in the forward looking statements include the
strength of world economies and currencies, changes in charter hire rates and
vessel values, changes in demand for “tonne miles” of oil carried by oil
tankers, the effect of changes in OPEC's petroleum production levels and
worldwide oil consumption and storage, changes in demand that may affect
attitudes of time charterers to scheduled and unscheduled dry-docking, changes
in TORM's operating expenses, including bunker prices, dry-docking and
insurance costs, changes in governmental rules and regulations including
requirements for double hull tankers or actions taken by regulatory
authorities, potential liability from pending or future litigation, domestic
and international political conditions, potential disruption of shipping routes
due to accidents and political events or acts by terrorists. Risks and
uncertainties are further described in reports filed by TORM with the US
Securities and Exchange Commission, including the TORM Annual Report on Form
20-F and its reports on Form 6-K.
Forward looking statements are based on management's current evaluation, and
TORM is only under obligation to update and change the listed expectations to
the extent required by law.
Teleconference
TORM will host a telephone conference for financial analysts and investors on
11 March 2009 at 15:00 Copenhagen time (CET), reviewing the annual report for
2009. The conference call will be hosted by CFO Roland M. Andersen and will be
conducted in English.
To participate, please call 10 minutes before the conference on tel.: +45 3271
4607 (from Europe) or +1 877 491 0064 (from the USA). The teleconference will
also be webcast via TORM's website www.torm.com. The presentation material can
be downloaded from the website.
About TORM TORM is one of the world's leading carriers of refined oil products
as well as a significant participant in the dry bulk market. The Company runs a
fleet of approximately 140 modern vessels, principally through a pooling
cooperation with other respected shipping companies who share TORM's commitment
to safety, environmental responsibility and customer service.
TORM was founded in 1889. The Company conducts business worldwide and is
headquartered in Copenhagen, Denmark. TORM's shares are listed on NASDAQ OMX
Copenhagen (ticker: TORM) and on NASDAQ in New York (ticker: TRMD). For further
information, please visit www.torm.com.
