Nordic American Tanker Shipping Ltd. (NAT) - (Amex: NAT) (OSE: NAT)
Announces Results for 3rd Quarter 2004 HAMILTON, Bermuda, Oct. 14
/PRNewswire/ -- Nordic American Tanker Shipping Ltd. (the
"Company") today announced its results for the 3rd quarter of 2004.
The tanker market was significantly stronger in the 3rd quarter of
2004 than in the 2nd quarter of 2004 as reflected in the Company's
enhanced dividend payment and operating results as described below.
At the beginning of the 4th quarter of this year, the market has
improved further. For the period ending September 30, 2004, the
Company had an operating profit of $33.4 million as compared to
$19.8 million during the same period last year. Net profit was
$32.0 million as compared to $18.5 million in the same period last
year. The increase in earnings in 2004 compared to the same period
in year 2003 is a result of the higher tanker spot market this
year. The results for the 3rd quarter of 2004 enable the Company to
pay a 4th quarter 2004 dividend of $1.11 per share which is 26.1%
higher than for the 3rd quarter of 2004. Including the dividend for
the 4th quarter of 2004, the total dividend to be paid in 2004 is
$4.84 per share. The total dividends paid in 2003 were $3.05. The
4th quarter dividend of $1.11 will be paid on or about November
19th 2004 to shareholders of record as of October 29, 2004. The
next dividend payment is expected to be declared in January 2005
for payment in February 2005. The spot market for modern Suezmax
tankers in the 3rd quarter of 2004 was above the agreed minimum
rate provided by the Company's bareboat charter contracts with BP
Shipping. The 3rd quarter 2004 time charter equivalent (TCE) rate
achieved by the Company's vessels was $55,742 per day compared to
$43,255 in the 2nd quarter of 2004, $72,287 in the 1st quarter of
2004 and $51,501 in the 4th quarter of 2003. The bareboat charter
contracts with BP Shipping commenced in October 1997. Two of those
contracts have now expired with the redelivery by BP Shipping of
two of the Company's vessels on September 13 and October 6, 2004,
respectively. The Company and BP Shipping have continued their
relationship with new time charter contracts for those two vessels.
The terms of those time charter contracts are described below. The
TCE in USD per day earned by the Company's vessels since 1999, by
calendar quarter, has been as follows: Period 1999 2000 2001 2002
2003 2004 1st Quarter 22,000 26,079 51,607 22,000 57,756 72,287 2nd
Quarter 22,000 33,701 35,088 22,000 38,291 43,255 3rd Quarter
22,000 48,153 28,668 22,000 23,243 55,742 4th Quarter 22,000 59,059
22,617 33,868 51,501 The results as of September 30, 2004 compared
to the same period last year (unaudited) are as follows: INCOME
STATEMENT INFORMATION All figures in USD 01.01-09.30 01.01-09.30
3rd Qtr. 3rd Qtr. 2004 2003 2004 2003 Revenue 39,963,680 25,502,450
13,061,794 4,070,322 Ship Broker Commissions (148,422) (138,206)
(56,284) (46,575) Vessel Operating Expenses (110,500) 0 (110,500) 0
Management Fee Expense (150,000) (187,500) (25,000) (62,500)
Insurance Expense (79,998) (75,000) (26,666) (25,000) Reorg.
charges/ Other Expenses (969,421) (111,119) (432,660) (26,118)
Depreciation (5,123,280) (5,123,280) (1,707,760) (1,707,760) Net
Operating Income 33,382,059 19,867,345 10,702,924 2,202,369
Financial Income 41,849 19,975 14,290 8,280 Financial Expenses
(1,398,690) (1,351,496) (516,485) (444,447) Net Financial Items
(1,356,841) (1,331,521) (502,195) (436,167) Net Profit 32,025,218
18,535,824 10,200,729 1,766,202 Earnings per Share 3.30 1.91 1.05
0.18 The Company has 9,706,606 shared issued and outstanding. The
quarterly dividend paid since the commencement of trading of the
Company's shares in 1997 has been as follows: Period 1997 1998 1999
2000 2001 2002 2003 2004 1st Quarter 0.40 0.32 0.34 1.41 0.36 0.63
1.15 2nd Quarter 0.41 0.32 0.45 1.19 0.34 1.27 1.70 3rd Quarter
0.32 0.35 0.67 0.72 0.33 0.78 0.88 4th Quarter 0.30 0.30 0.36 1.10
0.55 0.32 0.37 1.11 Total USD 0.30 1.43 1.35 2.56 3.87 1.35 3.05
4.84 Balance sheet data for the Company as of September 30, 2004
and December 31, 2003 (figures in USD) (unaudited) are set forth
below: 09/30/04 12/31/03 Vessels 122,958,645 128,081,925 Current
assets 10,057,909 8,248,449 Cash deposits 567,536 565,924 Total
assets 133,584,090 136,896,298 Shareholder's equity 102,580,201
106,857,976 Long term debt 30,000,000 30,000,000 Current
liabilities 1,003,889 38,322 Total liabilities & equity
133,584,090 136,896,298 As previously announced by the Company, BP
Shipping did not exercise its options to extend the original
bareboat charters for the Company's three Suezmax tankers.
Accordingly, the original bareboat charters for two of the
Company's vessels expired on September 13 and October 6, 2004,
respectively, when BP Shipping redelivered those vessels. The two
vessels continue to BP Shipping on time charter contracts with a
period of three years at spot market related rates in direct
continuation from the expired contracts. Our third ship is expected
to be redelivered by BP Shipping in mid-November at which time it
is expected to commence a five-year bareboat charter contract with
Gulf Navigation, Dubai. With the two vessels on time charter to BP
Shipping, the Company has become an operating company. With the
spot market related income from the two time chartered vessels,
plus the fixed income from the bareboat chartered vessel, the
Company's fleet is configured in order to maintain consistent cash
flows while taking advantage of current strong spot market rates.
Under the new time charter contracts with BP Shipping, the Company
will have the responsibility of providing the crew and of operating
and maintaining the vessels. These functions have been outsourced
to IUM Shipmanagement, Norway, a first class technical manager of
high reputation. As the Company has assumed responsibility for the
operation of the two ships, quality and cost effective operations
will be the prime focus. The management of the Company intends to
charter the ships in a manner that will allow the Company to cease
being classified as a "Passive Foreign Investment Company" for US
Tax purposes. This means that under current law, qualifying
dividends, which will be available to our non-corporate US
Shareholders commencing in 2006, are expected to be taxed at a
maximum United States federal income rate of 15%, rather that the
current maximum rate of 35%. For the foreseeable future, the
Company's Board intends to continue its policy of maintaining a low
debt to equity ratio and of prioritizing a dividend policy
essentially as in the past. This policy allows the Company's
shareholders to participate in the tanker charter market.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS Matters
discussed in this press release may constitute forward-looking
statements. The Private Securities Litigation Reform Act of 1995
provides safe harbor protections for forward-looking statements in
order to encourage companies to provide prospective information
about their business. Forward- looking statements 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 Company desires to take advantage of the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995 and is
including this cautionary statement in connection with this safe
harbor legislation. The words "believe," "except," "anticipate,"
"intends," "estimate," "forecast," "project," "plan," "potential,"
"will," "may," "should," "expect" "pending and similar expressions
identify forward-looking statements. The forward-looking statements
in this press release are based upon various assumptions, many of
which are based, in turn, upon further assumptions, including
without limitation, our management's examination of historical
operating trends, data contained in our records and other data
available from third parties. Although we believe 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, we cannot assure you that we will achieve or
accomplish these expectations, beliefs or projections. In addition
to these important factors, other 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, general market conditions,
including fluctuations in charter rates and vessel values, changes
in demand in the tanker market, as a result of changes in OPEC's
petroleum production levels and world wide oil consumption and
storage, changes in our operating expenses, including bunker
prices, drydocking and insurance costs, the market for our vessels,
availability of financing and refinancing, changes in governmental
rules and regulations or actions taken by regulatory authorities,
potential liability from pending or future litigation, general
domestic and international political conditions, potential
disruption of shipping routes due to accidents or political events,
vessels breakdowns and instances of off-hire and other important
factors described from time to time in the reports filed by the
Company with the Securities and Exchange Commission, including our
Annual Report on Form 20-F. Contacts: Scandic American Shipping Ltd
Manager for Nordic American Tanker Shipping Ltd. P.O. Box 56 3201
Sandefjord, Norway E-mail: Web site: http://www.nat.bm/ Rolf
Amundsen Chief Financial Officer Nordic American Tanker Shipping
Ltd. Tel: +1 800 601 9079 or + 47 908 26 906 Gary J. Wolfe, Esq.
Seward & Kissel LLP, New York, NY Tel: +1 212 574 1223 Herbjorn
Hansson Chairman & CEO Nordic American Tanker Shipping Ltd.
Tel: +1 866 805 9504 or + 47 901 46 291 DATASOURCE: Nordic American
Tanker Shipping Ltd. CONTACT: Rolf Amundsen, Chief Financial
Officer, Tel: 1-800-601-9079 or +47-908-26-906; or Herbjorn
Hansson, Chairman & CEO, Tel: 1-866-805-9504 or +47-901-46-291,
both of Nordic American Tanker Shipping Ltd.; or Gary J. Wolfe,
Esq. of Seward & Kissel LLP, Tel: +1-212-574-1223 Web site:
http://www.nat.bm/
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