SCF Group’s Net Profit Falls amid Soft Spot Tanker Rates

Image Courtesy: SCF

PAO Sovcomflot (SCF Group), Russia’s largest shipping company, reported a net profit of USD 206.8 million for 2016, down by 42 pct from the previously booked USD 354.5 million in 2015 amid market volatility.

As explained by Sergey Frank, President and CEO of Sovcomflot, 2016 witnessed a material softening in demand that impacted negatively spot tanker freight rates, albeit with some respite in the final quarter.

“Sovcomflot strengthened its position as the world’s largest harsh environment tanker operator through the opportune acquisition of nine well-maintained tankers that became available as part of the PRISCO bankruptcy proceedings. Further, we built upon our leadership position in IBSVs with the acquisition two existing vessels and launched a new IBSV all committed to the Sakhalin II Project,” Frank added.

SCF Group’s gross revenue (freight and hire) stood at USD 1.3 billion also a decline from USD 1.4 billion from last time around prompted by the tanker spot market drop by more than 40 per cent and time charter market drop by up to 25 per cent.

The company ended the year with substantial future contracted revenues of USD 8.1 billion.

In 2016, the group completed a series of debt fund raising totalling USD 1.26 billion which covered fully Sovcomflot’s capex requirements. The deals include USD 512 million of long-term bank loans from Russian and international banks raised for the fleet renewal programme and for the refinancing of maturing debt. Additionally last summer SCF Group returned to the international debt capital markets with a new USD 750 million seven year Eurobond offering to finance a simultaneous tender offer for the group’s outstanding Eurobonds due in 2017.

The company’s results come on the back of Sovcomflot’s latest order for the construction of four 114,000 dwt Ice-Class IA Aframax tankers at South Korean yard Hyundai Samho Heavy Industries (HSHI).

Share this article

Follow World Maritime News

In Depth>

Events>

<< Apr 2017 >>
MTWTFSS
27 28 29 30 31 1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
17 18 19 20 21 22 23
24 25 26 27 28 29 30

THE 30TH WORLD PORTS CONFERENCE Enabling Trade Energizing The World

This event is expected to have more than 500 attendees from the field of port, logistics, shipping and maritime industry…

read more >

Singapore Maritime Week 2017

Singapore Maritime Week (SMW) is the leading maritime event in Singapore. Driven by the Maritime and Port Authority of Singapore (MPA), SMW…

read more >

Breakbulk Europe 2017

For more than a decade, Breakbulk Europe has served as the networking hub for industry professionals who do business in Europe — or would like to! Exhibitors and sponsors include cargo owners, ocean carriers, freight forwarders, ports/terminals, heavy haulers, equipment companies and more that are involved in this specialized industry.

In addition to exceptional networking opportunities, Breakbulk Europe provides a dynamic conference, along with a range of educational and training workshops — intensive all-day classes held the day before the exhibition opens as well as many on-the-floor sessions.

  • Over 7,600 participants attended Breakbulk Europe 2016
  • Meet with over 400 exhibitors and sponsors
  • Hear from industry experts, including leading shippers, during the conference sessions
  • Learn new skills in the educational workshops held before the exhibition and on-the-floor micro-seminars and exhibitor-led sessions during the event

More info

read more >

Smart Operations

Smart Operations events, from Fathom Maritime Intelligence, examines how to use intelligent shared integration, and connected operations…

read more >