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Sovcomflot logged a 149 % rise in 1st-half net profit on the back of a strong term contracts portfolio

Sovcomflot logged a 149 % rise in 1st-half net profit on the back of a strong term contracts portfolio

Moscow, August 28 - Neftegaz.RU.Sovcomflot reported a net profit of $226.4 million in the January-June period, compared to $91 million a year ago. Revenue increased by 19.8 % year-on-year to $951.3 million, Offshore Energy reported.

Sovcomflot’s chief executive Igor Tonkovidov said EBITDA over the prior 12 months has exceeded $1 billion, for the 1st time in the firm’s history. January-June earnings before interest, tax, depreciation and amortisation rose 54.7 % to $578.6 million.

“An optimal balance of long- and short-term charter contracts, together with a rational geographic distribution of vessels allowed SCF Group to fully capitalise on the freight market upswing,” Tonkovidov said.

In the 1st half of the year, the energy shipping market dynamics were “highly volatile” due to the usual seasonal factor but also sharp price fluctuations in the oil market, caused by changes in the OPEC+ terms.

In the short term, this has contributed to the increase in both spot and time charter rates, which has allowed the group to grow its term contracts portfolio, Tonkovidov said.

Furthermore, Sovcomflot also continued to steadily grow its industrial business portfolio, which provides a long-term fixed income stream not impacted by market fluctuations.

“Over H1, SCF Group increased its time charter revenues from gas and offshore operations by 10 % to $342 million. At the end of the reporting period, the group had $12.8 billion in future contracted earnings and receivables, a record for the group,” Tonkovidov said.

LNG fleet growing

Earlier this year, Sovcomflot has welcomed another LNG carrier to its fleet, namely the SCF La Perouse. The new-generation Atlanticmax LNG carrier with a 174,000 cubic meter capacity started its charter with French energy giant Total.

Sovcomflot has 2 further vessels in this series under construction, chartered to LNG giant Shell, with deliveries scheduled in 2020. The state-owned shipping company’s fleet includes 146 vessels out of which 21 are LNG carriers.

Author: Mirza Duran

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