HIGHLIGHTS
FINANCIAL PERFORMANCE ODFJELL GROUP
- Gross revenues of USD 929 million
- EBITDA of USD 137 million
- Operating result (EBIT) USD 28 million
- Net loss of USD 36 million
STREAMLINING THE CHEMICAL TANKER BUSINESS
Following our cost-cutting and efficiency programme in 2015, a number of initiatives were introduced to streamline our fleet to achieve a more efficient fleet combination and trade optimisation. Also our processes have been improved to reduce our operational and administrative expenses, and several large and small measures have been taken to improve energy efficiency.
Trade and fleet optimisation
During 2015 we entered into time-charter agreements for three stainless steel chemical tankers with terms ranging from three to five years. Three vessels on time-charter were also redelivered to owners, the last one early January 2016.
In January we took delivery of a 49,622 dwt coated newbuilding from Hyundai Mipo Dockyard in Korea, the last vessel in a series of four vessels. Odfjell has no further newbuilding contracts for chemical tankers.
In second quarter, we exited the European regional trade by selling Bow Balearia, Bow Bracaria and Bow Brasilia all 5,800 dwt, built in 1997-1998. The vessels were divested as part of the cost cutting and efficiency programme.
As a part of the fleet development programme, in November 2015 Odfjell sold the vessel Bow Victor built in 1986 of 33,000 dwt, for recycling at RL Kalthia Shipbreaking at Alang in India. The yard is certified as compliant with the Hong Kong Convention on the Recycling of Ships and the 2012 Guidelines for Safe and Environmentally Sound Ship Recycling. The yard is further certified for ISO 9001, ISO 14991, OSHAS 18001 and ISO 30000.
General and administration reduction and reduced operational expenses
Our organisation has been reorganised to a leaner and more agile organisational structure fit for purpose.
Improved energy efficiency
Three significant energy efficiency measures were initiated for our vessels in 2015:
• Upgrading propulsion system on in total 19 large stainless steel vessels reducing fuel consumption and emissions by 20%.
• Installing reverse osmosis plants on 26 vessels for production of freshwater from seawater, reducing boiler consumption.
• Dashboard energy efficient concept to respond to over consumption/energy efficiency near real time.
TERMINALS STABLE WITH POSITIVE PROSPECTS
Odfjell Terminals (Rotterdam) (OTR) received their ISO certificates in January 2015 and by year end the commercially available occupancy was 964,034 cbm equivalent to 96.9%. The distillation activity (PID) with four distillation columns was operational with all four columns from second half of 2015. The largest distillation column went offline in December 2015 to increase the capacity of the unit to a total annual production of 1,800,000 tonnes.
Our new terminal in the new harbour in Tianjin, China was technically completed in first quarter 2015. Due to an explosion in the Tianjin old harbour the process of obtaining the necessary operational permits for our new terminal was delayed. The terminal was not directly affected by the explosion and we expect to open the terminal in second quarter 2016. Odfjell Nangang Terminals (Tianjin) will be the largest Odfjell terminal in China.
Odfjell Terminals (Houston) completed in October 2015 the construction of Bay 10, consisting of nine carbon steel tanks. Bay 10 has a total storage capacity of 17,190 cbm.
COST-CUTTING AND EFFICIENCY PROGRAMME – PROJECT FELIX
The Board of Odfjell SE launched a cost cutting programme in January 2015. The mandate for this project was to significantly improve the financial performance of Odfjell’s Chemical Tanker business. The target to improve the net result by in excess of USD 100 million on a yearly basis when fully implemented was successfully reached in December 2015. We expect full financial impact from the project in 2016, one year ahead of schedule. Odfjell has an invigorated focus on improving operations, and several new initiatives targeting operational performance have been launched during fourth quarter to further improve our strategic position and financial results.
Reverse osmosis plants will be installed on 26 vessels to reduce boiler consumption
19 large stainless steel vessels are being upgraded with new propulsion system leading to a reduction of about 20% of fuel consumption and emission. Due to the significant reduction in emissions the vessels, previously rated D+, will improve the energy rating to A+
OTR has commitments for new contracts that will ramp up during the first half of 2016 and utilise the majority of the PID capacity for 2016
In mid-March 2015 the largest ship ever docked at OTR. A Suex Max class unloading product to be processed at the PID distillation towers at OTR. The vessel was 275 metres long and 48 metres wide