Downturn hits Camillo Eitzen ship values

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

27 Feb 2009

The negative economical environment has put downward pressure on market values in all segments, resulting in an extraordinary write down (impairments) of booked vessel values with MUSD 237.2 in 4th quarter, of which MUSD 40.9 relates to Camillo Eitzen & Co ASA (CECO) and MUSD 196.2 relates to Eitzen Chemical ASA (ECHEM). CECO reports EBITDA of MUSD 22.4 for the 4th quarter, down from MUSD 122.2 in the 3rd quarter. The net loss in 4th quarter amounted to MUSD 287.2 compared to a net profit MUSD 75.9 in the 3rd quarter.
The shipping segments have been directly and indirectly affected by the international economical crises, and consequently the results were not satisfactory in the 4th quarter.
Full year consolidated EBITDA of MUSD 282.3 and net loss of MUSD 194.6 million, compared to MUSD 276.9 and MUSD 117.8 for 2007.
Reduced volumes under contracts of affreightment (COA), lower freight rates in the spot market and increased waiting time, resulted in weak earnings from the gas segment; EBITDA of MUSD 4.2, compared to MUSD 9.5 last quarter.
Eitzen Gas is currently discussing a change in its order for 6 semi-ref gas carriers at a shipyard in Japan. The negotiations have not been finalized, however it is expected that the change will reduce capital expenditures and financing requirements for the Company in the next 24-36 months.
Continued challenging bulk market, lead to postponement of cargoes under COA's for Eitzen Bulk and MUSD 14 in provisions. EBITDA of MUSD - 5.9 compared to MUSD 68.4 last quarter (of which MUSD 49.6 was profit from sale of vessels).
Continued soft chemical market, Eitzen Chemical ASA (ECHEM) reported EBITDA of MUSD 19.7 compared to MUSD 38.5 (including sale profit of MUSD 5.0) last quarter.
Satisfactory and steady results from Eitzen Maritime Services ASA (EMS), EBITDA of MUSD 6.3 compared to MUSD 6.6 last quarter.
As of 31 December 2008 CECO did not meet the covenant related to the minimum value adjusted equity ratio. CECO has initiated a discussion with the banks for an amendment to the loan agreement.

Source: Camillo Eitzen