Wallenius Wilhelmsen

Earnings Release • Feb 13, 2015

Wilh. Wilhelmsen ASA: Results for the fourth quarter of 2014

Wilh. Wilhelmsen ASA: Results for the fourth quarter of 2014

(Lysaker, 13 February 2015) Adjusted for non-

recurring items, WWASA's total income fell 2% from

the third quarter. General rate pressure and an

unfavourable cargo mix offset an increase in

transported volumes. Reduced bunker cost and cost-

reducing initiatives had a positive effect on

operating profit, ending on par with the previous

quarter.

WWASA delivered an operating profit of USD 76

million (USD 66 million) in the fourth quarter based

on a total income of USD 624 million (USD 671

million). Adjusted for non-recurring items, the

operating profit was USD 63 million (USD 82

million), while the total income was USD 624 million

(670 million). Adjustments this quarter included

changes in WWASA and Wallenius Wilhelmsen Logistics

(WWL) pension scheme and impairment of two vessels

for recycling. In the same quarter 2013, the group

recorded non-recurring items related to WWL's fine

from Japanese fair trade authorities and a sales

gain on one vessel.

"We transported approximately 19.6 million cubic

metres cargo in the fourth quarter, a 5% growth

quarter on quarter," says Jan Eyvin Wang, president

and CEO of WWASA. "The increase was mainly driven by

seasonality. Unfortunately, the cargo composition

continued to be unfavourable, leading to suboptimal

utilisation of our advanced vessels. Combined with a

general rate pressure and less profitable cargo this

had a negative impact on our earnings. With lower

contribution from Hyundai Glovis and the loss of a

substantial contract for the US government, the

logistics segment also contributed with less to

group accounts in the quarter."

The group continuously optimise capacity to market

demand and focus on cost-reducing initiatives. "We

now see that our profit improvement programme is

paying off and that we've managed to reduce

operational and administrative costs," comments

Wang. He also adds that the current bunker price is

favourable for the group: "Bunker expenses is a

substantial part of our operational costs. Lower

bunker costs lifted our profit quarter on quarter."

WWASA paid a total dividend of NOK 2.00 per share in

2014, of which NOK 1.00 in the fourth quarter.

Aiming for a consistent yearly dividend, the board

proposes to pay NOK 1.00 per share in the second

quarter and a maximum of NOK 1.25 in the fourth

quarter. The proposals are pending an approval at

the general meeting 23 April 2015.

The board of WWASA anticipates the group's volume

development to be relatively flat, adjusted for

seasonality. The demand for break bulk and

construction equipment is not expected to outweigh

low demand for mining and agriculture equipment.

With current fuel prices, the net bunker cost will

have a positive effect on operating profit,

supported by the effect from cost-reducing

initiatives. The logistics segment's contribution to

group accounts is expected to be in line with the

fourth quarter.