Quarterly Report • Feb 13, 2014
Quarterly Report
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WILH. WILHELMSEN ASA
(JOINT VENTURES BASED ON PROPORTIONATE METHOD)
Benedicte Bakke Agerup (CFO) Phone: +47 67 58 48 55 Mobile: +47 91 54 80 29 [email protected]
Phone: +47 67 58 41 77 Mobile: +47 95 90 79 51 [email protected]
| USD million | 2013 Q4 | 2013 Q3 | 2013 FY | 2012 FY | 2012 Q4 |
|---|---|---|---|---|---|
| Total income | 630 | 627 | 2523 | 2949 | 659 |
| Total income adjusted | 629 | 627 | 2522 | 2811 | 659 |
| EBITDA | 105 | 116 | 445 | 697 | 120 |
| EBITDA adjusted | 121 | 118 | 463 | 559 | 120 |
| EBIT | 66 | 78 | 293 | 548 | 81 |
| EBIT adjusted | 82 | 81 | 311 | 409 | 81 |
| Net profit/(loss) | 67 | 59 | 272 | 410 | 38 |
| Net profit/(loss) adjusted | 82 | 62 | 290 | 271 | 38 |
| Earnings per share | 0,30 | 0,27 | 1,23 | 1,86 | 0.17 |
| Region | Q4 2013 | Q3 2013 | QoQ change | Q4 2012 | YoY change | 2012 FY | 2013 FY |
|---|---|---|---|---|---|---|---|
| N America | 4.50 | 4.68 | -4 % | 4.25 | 6 % | 17.20 | 18.50 |
| Europe* | 3.24 | 3.22 | 0 % | 3.15 | 3 % | 14.10 | 13.70 |
| Oceania | 0.32 | 0.31 | 3 % | 0.32 | 0 % | 1.20 | 1.20 |
| BRICs | 8.39 | 7.27 | 15 % | 7.71 | 9 % | 28.40 | 30.20 |
| Brazil | 0.95 | 0.94 | 1 % | 0.98 | -3 % | 3.60 | 3.60 |
| Russia | 0.72 | 0.71 | 0 % | 0.75 | -4 % | 2.90 | 2.80 |
| India | 0.71 | 0.71 | 1 % | 0.80 | -10 % | 3.30 | 3.00 |
| China | 6.01 | 4.91 | 24 % | 5.18 | 17 % | 18.60 | 20.80 |
*Excluding Russia and Turkey
Total sale of light vehicles in key markets increased by 6% to 16.5 million units quarter on quarter. China recorded a strong sales growth supported by expectations of future restrictions on car purchases in Light vehicle sales in selected markets (million units). Source: WWL Global Market Intelligence
several major cities. North America saw a slight decline impacted by exceptionally cold weather. In most other regions sales were on par with the previous quarter.
Sale of light vehicles in key markets increased by 7% year over year. Car sales in Europe grew 3% after a long period of declining sales. Chinese sales increased 17%, while car sales in North America were up 6%. A recovering economy, improved credit availability, low interest rates in addition to new or redesigned models contributed to the positive development in US auto sales. The growth was however stronger for local produced cars than for imported brands.
Export of 1.1 million cars out of Japan in the fourth quarter represented a 3% increase from the previous quarter and a 7% improvement compared with the same quarter of 2012. Japanese export has declined from historically high levels due to weak demand from European consumers and increased transplant production by Japanese manufacturers. The trend, however, has slowly shifted and exports have shown a cautious but stable growth since mid 2012.
Korea reported a strong growth of 28% in car exports from the previous quarter mainly due to pent up demand after labour strikes in the third quarter. Total export volume was however slightly lower year over year.
When combining annual export of cars from China, Thailand and India the cargo volume approximately equates Korean export for a full year.
The level of light vehicle inventory in the US increased in the fourth quarter and counted approximately 3.5 million units. Inventory supply averaged 67 days of sales for the quarter but fell back to 58 days in December. Inventory levels were relatively high, but the elevated sales pace has balanced the high level.
Estimated global construction spending continued to indicate growth in absolute terms both quarter on quarter and year over year, and contributed to further strengthen demand for construction equipment.
US constructing spending gained momentum in anticipation of a recovery in non-residential construction and were lifted by a recovery in the housing market where the number of housing permits was higher compared with last year. Sentiment remained solid. Construction equipment inventory in the US remained unchanged from the previous quarter.
Commodity price indices for precious metals continued to fall during the fourth quarter and were 10% lower quarter on quarter and 30% lower year over year. Industrial metal indices were unchanged quarter on quarter, but weakened 13% from a high level in the fourth quarter of 2012. Iron ore prices (62% Fe to China) increased slightly from the third quarter as well as from last year, supporting Australian iron ore miners.
Given the general negative development in commodity prices from mid 2012, most mining companies remained cautious regarding investments in new projects. They showed a strict capital expenditure discipline and cost cutting initiatives were kept up in the quarter. Despite the negative sentiment, Australian mining production and exports of metal ores and minerals were at record high levels driven by the strong Chinese demand.
Inventory of US mining equipment remained at a high level.
Key agricultural commodity prices at the end of 2013 were lower than at the end of the third quarter.
US farmers experienced a very good harvest resulting in record high grain export. In North America, smaller tractors saw a declining growth rate this quarter, while larger tractors developed more favourably both quarter on quarter and year over year.
The world car carrying fleet counted 739 vessels (3.8 million CEUs) at the end of the fourth quarter, a net increase of two vessels from the previous quarter.
Two vessels were recycled during the fourth quarter, while four new larger vessels entered the global fleet.
Ten newbuildings were ordered during the quarter, increasing the global order book to 63 vessels (445 000 CEUs) representing
Group companies had a lifting capacity of 904 000 CEUs (874 000 CEUs) at the end of December 2013, up 1% from the third quarter of 2013 or 3.5% year over year. The fleet represented 24% of the global car carrying capacity. With a net increase of one vessels compared with the third quarter, the group controlled a total of 146 vessels (142 vessels) by the turn of the year.
Four options were declared for group companies this quarter. Two of the vessels were ordered for WWASA's account and will commence service for WWL upon delivery.
At the end of the fourth quarter, the newbuilding programme for group companies counted thirteen vessels (99 600 CEUs) to be delivered in 2014-2016, equalling 22% of the world car carrier orderbook measured in CEUs. Four of the vessels are for WWASA's own account.
No vessels were redelivered from group companies to external owners in the fourth quarter. The group has the flexibility to redeliver six vessels the next 12 months.
12% of the total world fleet measured in CEUs.
The average vessel age in the global car carrying fleet remained at approximately ten years.
One vessel was sold from WWASA for recycling in the fourth quarter - the pure-carand-truck-carrier Terrier. The demolition is taking place at green recycling facilities in China.
One WWASA controlled vessel was sold for recycling after the end of the fourth quarter – the ro-ro vessel Texas. The demolition will also be conducted at a green recycling facility in China.
The vessels Thai Shan and Takara were redelivered from WWASA to an external owner early February 2014.
| Com pany | Fleet by end of Q4 | Deliveries in Q4 Newbuilding programme by end of Q4 | Ya rd | |
|---|---|---|---|---|
| WWL | 59 vessels, 392000 CEUs, (61 vessels, 401000 CEUS |
Four pure car and truck carriers Post Panamaxdesign (32 000 CEUs) for WWASA's account. |
Hyun dai Sam ho | |
| Four pure car and truck carriers Post Panamax design (32 000 CEUs) not for WWASA's account. |
Xinga ng | |||
| EUKOR | 81 vessels, 478000 CEUs (75 vessels, 438 000 CEUs) |
On epure car and truck carrier (6600 CEU s ) for |
One pure car and truck carrier (6 600 CEUs) for EUKOR's account. Three pure car and truck carriers - Post |
Hyundai Gunsan Hyundai Gunsan |
| EUKOR's account. |
Panamaxdesign (22 800 CEUs) for EUKOR's account One pure car and truck carrier (6 200 CEUs) |
Imabar i | ||
| financed through long term charters with external owner. |
||||
| ARC | S ix vesse ls, 35 000 CEUs (six ve ssels, 35 000 CE Us) |
The WWASA group recorded an operating profit of USD 66 million (USD 81 million) and total income of USD 630 million (USD 659 million) in the fourth quarter of 2013. The figures were negatively affected by an accrual of approxiamtely USD 16.5 million related to the draft cease and desist order and draft surcharge WWL received from the Japanese Fair Trade Commision (JFTC) in January 2014 (WWASA's share). A nonrecurring item related to a sales gain from the recycling of Terrier had a positive effect, amounting to USD 1 million.
Volumes transported deep sea grew compared with the third quarter. Auto volumes increased, while the number of high and heavy units fell. The group also had an unfavorable trade mix. Contribution from the logistics activities was stable quarter on quarter.
For the full year of 2013, the WWASA group posted an operating profit of USD 293 million (USD 548 million) and a total income of USD 2 523 million (USD 2 949 million). The total income and operating profit for 2012 were positively affected by USD 139 million, of which USD 134 million was related to the group's share reduction in Hyundai Glovis. Operating profit for 2013 was negatively affected by non-recurring items totalling USD 18.5 million. Adjusted for the non-recurring items, the operating profit fell 24% from 2012 to 2013 while the total income fell 10%. This was caused by a weak development in the transportation of high and heavy equipment, lower car volumes and a suboptimal trade mix.
Financial expense amounted to USD 8 million (USD 11 million) for the fourth quarter and USD 8 million (USD 100 million) for the full year of 2013. Both the full and quarterly figures were positively impacted by an unrealised fair value gain on interest rate derivatives.
Group profit before tax and minority interests for the fourth quarter was USD 58 million (USD 71 million) while the corresponding figure for 2013 totalled USD 285 million (USD 448 million).
The group recorded a tax income in the fourth quarter equivalent to USD 9 million (expense of USD 33 million). Total tax expense for the year amounted to USD 12 million (expense of USD 37 million).
Net profit after tax and minority interest came to USD 67 million for the fourth quarter (USD 38 million) and USD 272 million for the full year of 2013 (USD 410 million). The 2012 figures were positively impacted by nonrecurring items.
The shipping segment recorded an operating profit of USD 41 million in the fourth quarter (USD 64 million) and a total income of USD 492 million (USD 536 million). Adjusted for the non-recurring items mainly related to the draft surcharge WWL received from the JFTC, the operating profit was USD 57 million and the total income USD 491 million.
For 2013, the adjusted operating profit declined by 40% and total income by 16% year over year, totalling USD 198 million (USD 328 million) and USD 1 973 million (USD 2 344 million) respectively.
Cargo volumes transported by group companies totalled 19.8 million CBM in the fourth quarter, up 6% from the previous quarter. Auto volumes picked up from the third quarter, supported by increased export out of Korea. The group's cargo mix was affected by a continued decline in high and heavy volumes. Driven by a stronger US economy, the westbound Atlantic and Asia to North America-trades had the most positive development.
Total cargo volumes transported by group companies grew by 6% driven by auto volumes, while high and heavy volumes fell.
The first half of 2012 was historically strong, with a particularly strong growth for high and heavy equipment. The cargo mix contributed positively to increased total income and operating profit. The favourable cargo mix enabled an optimal use of the group's fleet. 2013 was characterised by lower demand for transportation of both cars and high and heavy cargoes, although the last few months of 2013 recorded a positive upswing for auto volumes. A suboptimal balance among the different trades also impacted full year figures.
Wallenius Wilhelmsen Logistics (WWL owned 50%) transported cargo volumes grew compared with the third quarter, with positive development in shipment of both cargo segments. All main trades, except Asia to Europe, noted a positive development in the fourth quarter, with particularly strong growth in
the trades from Europe and Asia to North America.
Year over year, auto volumes transported on WWL's fleet improved slightly. High and heavy volumes fell however more than the increase in cars. This led to a slight reduction in total income, while the operating profit had a positive development after tonnage optimising initiatives.
EUKOR Car Carriers (EUKOR – owned 40%) saw a rebound in deep sea shipments compared with a third quarter which was characterised by reduced export following labour strikes. European demand continued to be weak causing an imbalance in the European-trade and higher operating cost, while there was a substantial improvement in the US trade.
Compared with the same quarter 2012, transported volumes were higher, with particular growth in export out of Europe and in non-Hyundai and Kia cargo segments.
American Roll-On Roll-Off Carrier (ARC – owned 50%) recorded a significant drop in volumes quarter on quarter negatively affecting the company's profitability. The decline in volume was first and foremost related to the Middle East service. Closing down this service incurred extra restructuring cost. Capacity has been adjusted to cargo availability, and ARC is targeting further group synergies through optimising the Atlantic service.
Compared with the corresponding quarter of 2012, volumes were higher, particularly in the Atlantic trade. However, a changed trade and cargo mix hurt margins.
Ship operating activities in Hyundai Glovis (owned 12.5%) contributed with USD 2 million (USD 3 million) to WWASA's fourth quarter accounts and USD 7 million (USD 12 million) to the group's full year accounts.
The group's joint ventures WWL and EUKOR are subject to an anti-trust investigation of the car carrying industry in several jurisdictions. In January 2014, the Japanese Fair Trade Commission (JFTC) issued a draft cease and desist order and a draft surcharge order indicating that WWL as one of several companies in the car carrying industry has participated in non-competitive behavior in automotive transportation. The draft surcharge for WWL's account is estimated to USD 33
The logistics segment recorded an operating profit for the fourth quarter of USD 27 million (USD 20 million) and a total income of USD 145 million (USD 128 million). The corresponding figures for the full year of 2013 were USD 107 million (USD 229 million) and USD 576 million (USD 628 million). The total income and operating profit for 2012 were positively impacted by non-recurring items totalling USD 139 million, of which USD 134 million was related to the group's share reduction in Hyundai Glovis.
Adjusted for non-recurring items, the group's operating profit and total income from logistics activities in 2013 amounted to USD 108 million (USD 91 million) and USD 576 million (USD 490 million respectively).
million and primarily related to the Japan-Europe trade (WWASA's share USD 16.5 million).
The draft cease and desist order and draft surcharge order are provided to the companies concerned for their review and comment, in advance of a final ruling by the JFTC, which WWL expects to receive in the second quarter.
EUKOR was initially included in the investigation, but has been dropped from the investigation by the JFTC.
Cost of process management related to this investigation is charged on an ongoing basis. Except the accrual of USD 16.5 million related to the draft surcharge order from JFTC, no other accruals or reserves have been charged to the accounts in the fourth quarter.
The company has not received any further information on ongoing investigations in other jurisdictions, but WWL and EUKOR have and will cooperate and respond to any questions authorities might have.
The group had a slight decrease in operating profit and total income followed by seasonality in the US based logistics activities.
Contribution from Hyundai Glovis and increased income from WWL technical services lifted total income and result from the logistics activities year over year.
Higher activity in all the groups logistic entities year on year lifted operating profit and total income in 2013 compared with 2012. Hyundai Glovis contributed most to the improved earnings compared with the other logistics entities.
WWL's terminal services handled 582 000 units (546 000 units) in the fourth quarter. Terminal activities rose both quarter on quarter and year over year, with a particular strong improvement in the high and heavy segment lifting total income both quarter on quarter and year over year. Operating profit was negatively impacted by operations in Oceania.
WWL's technical services, including among other things vehicle repair and outfitting, performed services on approximately 1.5 million units (1.5 million units) in the fourth quarter. Auto volumes were on par with the previous quarter, while high and heavy volumes improved somewhat. A similar pattern was seen in the development year over year.
Quarter on quarter, the top line and operating profit were on par with the previous quarter.
The profit for 2013 was in line with 2012 based on an improved total income.
Inland distribution services offered by WWL are mainly based on purchases from third party contractors with a significant proportion of revenues and costs incurred on a pass-through basis. A total of 612 000 units were handled in the fourth quarter (592 000 units).
A continued improvement in volumes transported inland has lifted total income continuously throughout 2013 compared with 2012. Expect for the last quarter of 2013, the profit has followed a similar pattern.
The volumes handled by the American Shipping and Logistics group (owned 50%) were reduced from a seasonally strong third quarter negatively impacting total income and operating profit. The underlying growth has however contributed to stronger total income and profit year over year. As informed in the third quarter, the company was not awarded the Global Privately Owned Vehicle contract for the US Department of Defense. The company filed a protest with the US General Accountability Office, which has been denied. AAL has initiated a legal process whereby it is challenging this decision.
The contribution from Hyundai Glovis in WWASA's group accounts for the fourth quarter based on a 12.5 % ownership, consolidated one quarter in arrears, was USD 16 million (USD 10 million). For the full year 2013, Hyundai Glovis contributed with USD 55 million (USD 180 million). Adjusted for the sales gain following WWASA share reduction in the company in August 2012, the contribution was USD 47 million.
The market value of WWASA's share holding in Hyundai Glovis was USD 1 017 million at 12 February 2014.
The WWASA group recorded a financial expense amounting to USD 8 million (USD 11 million) in the fourth quarter, while the corresponding amount for the full year of 2013 was an expense of USD 8 million (USD 100 million), positively impacted by an unrealised gain on interest rate derivatives.
The investment portfolio continued to contribute with a good return in the fourth quarter.
Net interest expenses increased with USD 5 million quarter on quarter, caused by an early termination of interest rate swaps. Interest expenses for 2013 amounted to USD 99 million (USD 121 million) of which USD 38 million was related to realised losses on the interest hedging portfolio as WWASA has a relatively high portion of the total debt hedged to fixed rate.
An increase in the long term USD interest rates lead to an unrealised gain of USD 19 million (USD 22 million) on interest rate
derivatives in the fourth quarter, while the corresponding figure for the full year 2013 was USD 71 million (USD 11 million).
Net currency items in the quarter amounted to a loss of USD 1 million (USD 2 million). For 2013 as a whole, the net effect from currency items for WWASA was a gain of USD 8 million (USD 0 million).
The bunker exposure is mainly covered through bunker adjustment factors (BAF) in the ocean contracts. In addition the operating companies have entered into bunker hedging contracts which created an unrealised loss of USD 3 million (loss of USD 1 million).
A realised gain on the bunker hedging contracts this quarter of USD 3 million (USD 3 million) was recorded as a reduction in operating expenses while the corresponding figure for the full year of 2013 was USD 10 million (USD 12 million).
The group recorded a tax income of USD 9 million in the fourth quarter (expense of USD 33 million), while the corresponding
Cash and cash equivalents including the investment portfolio amounted to USD 411 million at the end of the fourth quarter 2013 (USD 677 million when including the group's share of cash and cash equivalents in the joint ventures), a reduction of USD 31 million from the previous quarter, mainly caused by repayment of debt and payment of dividend.
The group's equity amounted to USD 1 632 million (USD 1 544 million), representing an equity ratio of 48% based on book values for WWASA's own account.
A dividend of NOK 4.75 per share totalling USD 175 million was paid to shareholders figure for 2013 in total was an expense of USD 12 million (USD 37 million).
in 2013. The dividend included an extraordinary payment of NOK 3 per share paid in May.
The board will propose to the Annual General Meeting (AGM) to pay a dividend of NOK 1 per share in the first half of 2014, totalling approximately USD 36 million. Following last year changes to the Norwegian Companies Act, the board will also propose that the AGM gives the board authority to approve further dividend of up to NOK 1.25 per share for a period limited in time up to the next AGM.
WWASA's gross interest bearing debt amounted to USD 1 502 million (USD 2 148 million when including the group's share of interest-bearing debt in joint ventures) at the end of the fourth quarter. The company issued a five year bond of NOK 1 billion in June 2013, of which NOK 700 million was drawn for general corporate purposes.
Volumes transported by the group's shipping companies in 2013 declined compared with a historically strong 2012, driven by inventory build up of high and heavy equipment.
Following uncertainty regarding the US logistics activities and a general pressure on margins in both the shipping and logistics
segments, the group has initiated an efficiency programme.
The board expects a modest growth in the demand for the group's seaborne services. Prospects for car volumes are more positive than the demand for transportation of high and heavy units.
Lysaker, 12 February 2014 The board of directors of Wilh. Wilhelmsen ASA
Forward-looking statements presented in this report are based on various assumptions. The assumptions were reasonable when made, but are inherently subject to uncertainties and contingencies which are difficult or impossible to predict. WWASA cannot give assurances that expectations regarding the future outlook will be achieved or accomplished.
Joint ventures based on proportionate method
| USD mill | Shipping | Logistics | Holding | Eliminations | Total | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Full | Full | Full | Full | Full | |||||||||||
| Q4 | Q4 | year | Q4 | Q4 | year | Q4 | Q4 | year | Q4 | Q4 | year | Q4 | Q4 | year | |
| QUARTER | 2013 | 2012 | 2012 | 2013 | 2012 | 2012 | 2013 | 2012 | 2012 | 2013 | 2012 | 2012 | 2013 | 2012 | 2012 |
| Operating revenue | 489 | 534 | 2 333 | 129 | 119 | 448 | 2 | 2 | 7 | (9) | (7) | (30) | 610 | 647 | 2 758 |
| Other income | |||||||||||||||
| Share of profit from | |||||||||||||||
| associates | 3 | 2 | 11 | 16 | 10 | 47 | 0 | 19 | 12 | 57 | |||||
| Gain on sale of assets | 1 | 134 | 0 | 1 | 134 | ||||||||||
| Total income | 492 | 536 | 2 344 | 145 | 128 | 628 | 2 | 2 | 7 | (9) | (7) | (30) | 630 | 659 | 2 949 |
| Operating expenses | |||||||||||||||
| Voyage expenses | (227) | (261) | (1 154) | 7 | 6 | 24 | (220) | (255) | (1 130) | ||||||
| Vessel expenses | (21) | (20) | (84) | (21) | (20) | (84) | |||||||||
| Charter expenses | (84) | (86) | (375) | (84) | (86) | (375) | |||||||||
| Employee benefits | (39) | (44) | (160) | (8) | (10) | (32) | (3) | (3) | (11) | (50) | (57) | (203) | |||
| Other expenses | (43) | (24) | (98) | (108) | (97) | (362) | (1) | (2) | (6) | 2 | 2 | 6 | (151) | (122) | (460) |
| Depreciation and impairment | (37) | (37) | (144) | (2) | (1) | (6) | (0) | (39) | (38) | (150) | |||||
| Total operating expenses | (451) | (472) | (2 015) | (117) | (109) | (399) | (4) | (5) | (18) | 9 | 7 | 30 | (564) | (578) | (2 402) |
| Operating profit (EBIT) 2 | 41 | 64 | 328 | 27 | 20 | 229 | (3) | (3) | (10) | 0 | 0 | 0 | 66 | 81 | 547 |
| Financial income/(expenses) | (6) | (6) | (81) | (1) | 1 | 1 | (1) | (5) | (20) | (8) | (11) | (100) | |||
| Profit/(loss) before tax | 35 | 58 | 247 | 26 | 20 | 230 | (4) | (8) | (30) | 0 | 0 | 0 | 58 | 70 | 448 |
| Tax income/(expense) | 8 | (32) | (30) | (3) | (2) | (14) | 4 | 2 | 7 | 9 | (33) | (37) | |||
| Profit/(loss) | 44 | 26 | 217 | 23 | 18 | 216 | 0 | (7) | (23) | 0 | 0 | 0 | 67 | 37 | 410 |
| Of which minority interest | (1) | (1) | |||||||||||||
| Profit/(loss) after minority | |||||||||||||||
| interest | 44 | 26 | 217 | 23 | 18 | 215 | 0 | (7) | (23) | 0 | 0 | 0 | 67 | 37 | 409 |
1 The report is based on the proportionate method for all joint ventures.
The equity method provides a fair presentation of the group's financial position but the group's internal financial reporting is based on the proportionate method. The major contributors in the shipping and logistics segments are joint ventures and hence the proportionate method gives the chief operating decision-maker a higher level of information and a better picture of the group's operations.
2 Cash settled portion of bunker hedge swaps is included in net operating profit by reduction/(increase) of voyage related expenses
As a result of rounding adjustments, the figures in one or more columns may not add up to the total of that column.
Joint ventures based on proportionate method
| USD mill | Shipping Logistics Holding |
Eliminations | Total | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| YTD | YTD | YTD | YTD | YTD | YTD | YTD | YTD | YTD | YTD | |
| Year to date | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 |
| Operating revenue | 1 964 | 2 333 | 521 | 448 | 6 | 7 | (31) | (30) | 2 460 | 2 758 |
| Other income | ||||||||||
| Share of profit from | ||||||||||
| associates | 7 | 11 | 55 | 47 | 62 | 57 | ||||
| Gain on sale of assets | 1 | 134 | 1 | 134 | ||||||
| Total income | 1 973 | 2 344 | 576 | 628 | 6 | 7 | (31) | (30) | 2 523 | 2 949 |
| Operating expenses | ||||||||||
| Voyage expenses | (934) | (1 154) | 26 | 24 | (909) | (1 130) | ||||
| Vessel expenses | (86) | (84) | (86) | (84) | ||||||
| Charter expenses | (335) | (375) | (335) | (375) | ||||||
| Employee benefits | (157) | (160) | (35) | (32) | (12) | (11) | (204) | (203) | ||
| Other expenses | (117) | (98) | (427) | (362) | (6) | (6) | 6 | 6 | (544) | (460) |
| Depreciation and impairment | (145) | (144) | (7) | (6) | (152) | (150) | ||||
| Total operating expenses | (1 775) | (2 015) | (469) | (399) | (18) | (18) | 31 | 30 | (2 230) | (2 402) |
| Operating profit (EBIT) 2 | 198 | 328 | 107 | 229 | (12) | (10) | 0 | 0 | 293 | 547 |
| Financial income/(expenses) | (13) | (81) | (1) | 1 | 6 | (20) | (8) | (100) | ||
| Profit/(loss) before tax | 186 | 247 | 106 | 230 | (7) | (30) | 0 | 0 | 285 | 448 |
| Tax income/(expense) | 1 | (30) | (17) | (14) | 4 | 7 | (12) | (37) | ||
| Profit/(loss) | 186 | 217 | 90 | 216 | (2) | (23) | 0 | 0 | 273 | 410 |
| Of which minority interest | (2) | (1) | (2) | (1) | ||||||
| Profit/(loss) after minority | ||||||||||
| interest | 186 | 217 | 88 | 215 | (2) | (23) | 0 | 0 | 272 | 409 |
1/2 Comments - see previous page
2013: Material gain/(loss) from disposal of assets and impairment charges (* Included in share of profits from associates and joint ventures)
Shipping: Q1 - No material gain/(loss)
Shipping: Q2 - No material gain/(loss)
Shipping: Q3 - No material gain/(loss)
Shipping: Q4 - No material gain/(loss)
2012: Material gain/(loss) from disposal of assets and impairment charges (* Included in share of profits from associates and joint ventures)
Shipping: Q1 - No material gain/(loss)
Shipping: Q2 - No material gain/(loss)
Logistics: Q3 - WWASA sold 937 500 shares in Hyundai Glovis. The net gain recorded in the group's accounts amounted to USD 134 million.
Shipping: Q4 - No material gain/(loss)
Joint ventures based on proportionate method
| USD mill | Shipping | Logistics | Holding | Total incl elimination | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | |
| QUARTER | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 | 2013 |
| Operating revenue | 476 | 517 | 483 | 489 | 127 | 129 | 136 | 129 | 1 | 1 | 1 | 2 | 597 | 640 | 612 | 610 |
| Other income | ||||||||||||||||
| Share of profit from | ||||||||||||||||
| associates | 2 | 1 | 2 | 3 | 16 | 10 | 13 | 16 | 17 | 11 | 15 | 19 | ||||
| Gain on sale of assets | 1 | 1 | ||||||||||||||
| Total income | 477 | 518 | 486 | 492 | 142 | 139 | 149 | 145 | 1 | 1 | 1 | 2 | 614 | 652 | 627 | 630 |
| Operating expenses | ||||||||||||||||
| Voyage expenses | (231) | (245) | (232) | (227) | (226) | (239) | (224) | (220) | ||||||||
| Vessel expenses | (23) | (21) | (22) | (21) | (23) | (21) | (22) | (21) | ||||||||
| Charter expenses | (82) | (89) | (80) | (84) | (82) | (89) | (80) | (84) | ||||||||
| Employee benefits | (39) | (38) | (40) | (39) | (9) | (9) | (10) | (8) | (3) | (3) | (3) | (3) | (51) | (50) | (53) | (50) |
| Other expenses | (25) | (26) | (23) | (43) | (104) | (106) | (109) | (108) | (2) | (1) | (1) | (1) | (128) | (132) | (133) | (151) |
| Depreciation and impairment | (36) | (37) | (36) | (37) | (2) | (2) | (2) | (2) | (38) | (38) | (38) | (39) | ||||
| Total operating expenses | (435) | (456) | (433) | (451) | (114) | (117) | (121) | (117) | (5) | (4) | (5) | (4) | (547) | (570) | (549) | (564) |
| Operating profit (EBIT) 2 | 42 | 62 | 53 | 41 | 28 | 22 | 29 | 27 | (3) | (3) | (4) | (3) | 67 | 82 | 78 | 66 |
| Financial income/(expenses) | (5) | 8 | (9) | (6) | (1) | (3) | 14 | (4) | (1) | (7) | 22 | (14) | (8) | |||
| Profit/(loss) before tax | 38 | 69 | 43 | 35 | 28 | 23 | 29 | 26 | (6) | 12 | (8) | (4) | 60 | 104 | 64 | 58 |
| Tax income/(expense) | (3) | (3) | (1) | 8 | (4) | (4) | (5) | (3) | 2 | (4) | 2 | 4 | (5) | (12) | (4) | 9 |
| Profit/(loss) | 35 | 66 | 42 | 44 | 24 | 18 | 24 | 23 | (5) | 8 | (6) | 0 | 54 | 92 | 60 | 67 |
| Of which minority interest | (1) | (1) | ||||||||||||||
| Profit/(loss) after minority | ||||||||||||||||
| interest | 35 | 66 | 42 | 44 | 24 | 18 | 23 | 23 | (5) | 8 | (6) | 0 | 54 | 92 | 59 | 67 |
1/2 Comments - see previous page
Joint ventures based on proportionate method
| USD mill | 01.10-31.12 | 01.10-31.12 | YTD | YTD |
|---|---|---|---|---|
| 2013 | 2012 | 2013 | 2012 | |
| Financials | ||||
| Investment management 1 | 5,2 | 2,6 | 13,6 | 9,8 |
| Interest income | 0,9 | 1,0 | 3,0 | 3,4 |
| Other financial items | (0,4) | 3,7 | (0,7) | (1,7) |
| Net financial items | 5,7 | 7,3 | 15,9 | 11,6 |
| Net financials - interes rate | ||||
| Interest expenses | (15,5) | (15,9) | (61,3) | (69,0) |
| Interest rate derivatives - realised | (13,8) | (20,4) | (38,0) | (51,9) |
| Net interest expenses | (29,3) | (36,3) | (99,3) | (120,9) |
| Interest rate derivatives - unrealised | 18,7 | 21,6 | 71,2 | 11,4 |
| Net financial - currency | ||||
| Net currency gain/(loss) | 5,9 | (6,6) | 45,5 | (31,1) |
| Currency derivatives - realised | (3,9) | (3,4) | (7,7) | 6,7 |
| Currency derivatives - unrealised | (1,3) | 2,9 | (13,7) | 5,8 |
| Cross currency derivatives - realised | 1,0 | 0,7 | 3,4 | 12,9 |
| Cross currency derivatives - unrealised | (2,6) | 4,2 | (19,8) | 6,0 |
| Net currency items | (1,0) | (2,1) | 7,7 | 0,3 |
| Financial derivaties bunkers Valuation of bunker hedges Net financial derivatives bunkers Financial income/(expenses) |
(2,5) (2,5) (8,4) |
(1,1) (1,1) (10,6) |
(3,2) (3,2) (7,7) |
(1,8) (1,8) (99,6) |
1 Includes financial derivatives for trading
| USD mill | 01.10-31.12 | 01.10-31.12 | YTD | YTD |
|---|---|---|---|---|
| 2013 | 2012 | 2013 | 2012 | |
| Cash settled bunker and fuel hedges | 2,7 | 3,1 | 10,3 | 12,3 |
(JOINT VENTURES BASED ON EQUITY METHOD)
Wilh. Wilhelmsen ASA group Q4 2013 Unaudited 14 of 29
2013 was characterised by lower demand for transportation of both cars and high and heavy cargoes. A suboptimal balance among the different trades also impacted full year figures.
Higher activity in all the groups logistic entities year on year lifted operating profit and total income in 2013 compared with 2012. Hyundai Glovis contributed most to the improved earnings compared with the other logistics entities.
Volumes transported deep sea in the fourth quarter of 2013 grew compared with the third quarter. Auto volumes increased, while the number of high and heavy units fell. The group's performance was also negatively impacted by an unfavorable trade mix. Contribution from the logistics activities was stable quarter on quarter.
The WWASA group recorded an operating profit for the fourth quarter of 2013 amounting to USD 56 million (USD 74 million) based on a total income USD 117 million (USD 138 million).
For 2013 in total, the WWASA group posted an operating profit of USD 255 million (USD 508 million) and a total income of USD 508 million (USD 759 million). The total income and operating profit for 2012 were positively affected by non-recurring items amounting
to USD 139 million, of which USD 134 million was related to sales gain following the group's share reduction in Hyundai Glovis in August 2012. Adjusted for nonreccuring items, operating profit and total income for 2013 declined 27% and 16% respectively compared with 2012.
Financial expense amounted to USD 3 million (expense of USD 8 million) for the fourth quarter and gain of USD 9 million for the full year (expense USD 82 million). The investment portfolio continued to contribute with a good return in the fourth quarter.
Net interest expenses increased with USD 5 million quarter on quarter, caused by an early termination of interest rate swaps. Net interest expenses for 2013 amounted to USD 81 million (USD 98 million) of which USD 36 million was related to realised losses on the interest hedging portfolio as WWASA has a relatively high portion of the total debt hedged to fixed rate.
An increase in the long term USD interest rates lead to an unrealised fair value gain of USD 18 million (USD 21 million) on interest rate derivatives in the fourth quarter, while the corresponding figure for the full year was USD 68 million ( USD 9 million).
Net currency items in the quarter amounted to a loss of USD 1 million (USD 3 million). For 2013 as a whole, the net effect from currency items was a gain of USD 9 million (USD 0 million).
Group profit before tax for the fourth quarter was USD 53 million (USD 66 million), while the corresponding figure for 2013 in total was USD 264 million (USD 427 million).
The group recorded a tax income of USD 14 million in the fourth quarter (expense of USD 28 million), with the total tax income for the full year amounting to USD 7 million (expense USD 17 million).
Net profit after tax came to USD 67 million for the fourth quarter (USD 38 million) and USD 272 million for 2013 in total (USD 410 million).
Cash and cash equivalents including the bond investment portfolio amounted to USD 411 million at the end of the fourth quarter. This is a reduction of USD 31 million from the previous quarter, mainly caused by repayment of debt and payment of dividend.
The group's equity amounted to USD 1 632 million (USD 1 544 million), representing an equity ratio of 48% based on book values for WWASA's own account.
WWASA's gross interest bearing debt, excluding the group's share of interestbearing debt in joint ventures, amounted to USD 1 502 million at the end of the quarter (USD 1 534 million). The company issued a 5 year bond of NOK 1 billion in June 2013 of which NOK 700 mill was drawn for general corporate purposes.
A dividend of NOK 4.75 per share totalling USD 175 million was paid to shareholders in 2013. The dividend included an extraordinary payment of NOK 3 per share paid in May.
The board will propose to the Annual General Meeting (AGM) to pay a dividend of NOK 1 per share in the first half of 2014, totalling approximately USD 36 million. Following last year changes to the Norwegian Companies Act, the board will also propose that the AGM gives the board authority to approve further dividend of up to NOK 1.25 per share for a period limited in time up to the next AGM.
The group's joint ventures WWL and EUKOR are subject to an anti-trust investigation of the car carrying industry in several jurisdictions. In January 2014, the Japanese Fair Trade Commission (JFTC) issued a draft cease and desist order and a draft surcharge order indicating that WWL as one of several companies in the car carrying industry has participated in noncompetitive behavior in automotive transportation. The draft surcharge is estimated to USD 33 million and primarily related to the Japan-Europe trade (WWASA's share USD 16.5 million).
The draft cease and desist order and draft surcharge order are provided to the companies concerned for their review and comment, in advance of a final ruling by the JFTC, which WWL expects to receive in the second quarter.
EUKOR was initially included in the investigation, but has been dropped from the investigation by the JFTC.
Cost of process management related to this investigation is charged on an ongoing basis. Except the accrual of USD 16.5 million related to the draft surcharge order from JFTC, no other accruals or reserves have been charged to the accounts in the fourth quarter.
The company has not received any further information on ongoing investigations in other jurisdictions, but WWL and EUKOR have and will cooperate and respond to any questions authorities might have.
Volumes transported deep sea by the group's shipping companies in 2013 declined compared with a historically strong 2012, driven by inventory build up of high and heavy equipment.
Following uncertainty regarding the US logistics activities and a general pressure on margins in both the shipping and logistics segments, the group has initiated an efficiency programme.
The board expects a modest growth in the demand for the group's seaborne services. Prospects for car volumes are more positive than the demand for transportation of high and heavy units.
| USD mill | Notes | 01.10-31.12 | 01.10-31.12 | YTD | YTD |
|---|---|---|---|---|---|
| 2013 | 2012 | 2013 | 2012 | ||
| Operating revenue | 83 | 88 | 325 | 395 | |
| Other income | |||||
| Share of profit from joint ventures and associates | 32 | 51 | 182 | 230 | |
| Gain on sale of assets | 2 | 1 | 1 | 134 | |
| Total income | 117 | 138 | 508 | 759 | |
| Operating expenses | |||||
| Vessel expenses | (12) | (13) | (53) | (52) | |
| Charter expenses | (7) | (7) | (28) | (26) | |
| Employee benefits | (19) | (20) | (79) | (78) | |
| Other expenses | (2) | (3) | (11) | (12) | |
| Depreciation and impairment | 3 | (21) | (22) | (82) | (83) |
| Total operating expenses | (61) | (64) | (253) | (251) | |
| Operating profit (EBIT) | 56 | 74 | 255 | 508 | |
| Financial income/(expenses) | 4 | (3) | (8) | 9 | (82) |
| Profit before tax | 53 | 66 | 264 | 427 | |
| Tax income/(expense) | 14 | (28) | 7 | (17) | |
| Profit for the period attributable to the owners of the parent | 67 | 38 | 272 | 410 | |
| Basic and diluted earnings per share (USD)* | 0,30 | 0,17 | 1,23 | 1,86 |
* EPS is calculated based on 220 000 000 shares.
| USD mill | Notes | 01.10-31.12 2013 |
01.10-31.12 2012 |
YTD 2013 |
YTD 2012 |
|---|---|---|---|---|---|
| Profit/(loss) for the period | 67 | 38 | 272 | 410 | |
| Other comprehensive income | |||||
| Items that will be reclassified to income statement | |||||
| Fair value adjustment available-for-sale financial assets | (0,4) | (0,1) | (0,4) | ||
| Currency translation differences | 0 | 1 | 1 | (0) | |
| Items that will not be reclassified to income statement | |||||
| Remeasurement postemployment benefits, net of tax | (9) | 0 | (9) | 1 | |
| Other comprehensive income, net of tax | (9) | 1 | (8) | 1 | |
| Total comprehensive income attributable to owners of the parent | 58 | 39 | 264 | 411 |
The above consolidated income statement and comprehensive income should be read in conjunction with the accompanying notes.
Joint ventures based on equity method
| USD mill | Notes | 31.12.2013 | 31.12.2012 |
|---|---|---|---|
| Non current assets | |||
| Deferred tax asset | |||
| Goodwill and other intangible assets | 3 | 6 | 6 |
| Investments in vessels and other tangible assets | 3 | 1 821 | 1 868 |
| Investments in joint ventures and associates | 1 120 | 976 | |
| Other non current assets | 5 | 46 | |
| Total non current assets | 2 952 | 2 897 | |
| Current assets | |||
| Current financial investments | 254 | 130 | |
| Other current assets | 25 | 37 | |
| Cash and cash equivalents | 157 | 344 | |
| Total current assets | 436 | 511 | |
| Total assets | 3 388 | 3 407 | |
| Equity | |||
| Share capital | 6 | 30 | 30 |
| Retained earnings and other reserves | 1 602 | 1 514 | |
| Total equity attributable to owners of the parent | 1 632 | 1 544 | |
| Non current liabilities | |||
| Pension liabilities | 60 | 56 | |
| Deferred tax | 51 | 66 | |
| Non current interest-bearing debt | 8 | 1 320 | 1 417 |
| Other non current liabilities | 95 | 163 | |
| Total non current liabilites | 1 527 | 1 702 | |
| Current liabilities | |||
| Current income tax liabilities | 2 | 0 | |
| Public duties payable | 1 | 1 | |
| Other current liabilities | 225 | 160 | |
| Total current liabilities | 229 | 161 | |
| Total equity and liabilities | 3 388 | 3 407 |
The above consolidated balance sheet should be read in conjunction with the accompanying notes.
Joint ventures based on equity method
| USD mill | Note | 01.10-31.12 | 01.10-31.12 | YTD | YTD |
|---|---|---|---|---|---|
| 2013 | 2012 | 2013 | 2012 | ||
| Cash flow from operating activities | |||||
| Profit before tax | 53 | 67 | 264 | 427 | |
| Financial income/(expenses) | 15 | 39 | 32 | 113 | |
| Financial derivatives unrealised | (14) | (29) | (35) | (31) | |
| Depreciation/impairment | 4 | 21 | 20 | 82 | 83 |
| (Gain)/loss on sale of fixed assets | (1) | (1) | (0) | ||
| Net (gain)/loss from sale of associate | (134) | ||||
| Change in net pension asset/liability | (2) | (1) | (8) | 1 | |
| Other change in working capital | 8 | (14) | (1) | 10 | |
| Share of profit from joint ventures and associates | (32) | (51) | (182) | (230) | |
| Dividend received from joint ventures and associates | 10 | 6 | 42 | 53 | |
| Tax paid (company income tax, witholding tax) | (10) | 1 | (22) | ||
| Net cash provided by/(used in) operating activities | 56 | 26 | 194 | 270 | |
| Cash flow from investing activities | |||||
| Proceeds from sale of fixed assets | 5 | 14 | |||
| Investments in vessels, other tangible and intangible assets | 4 | (19) | 1 | (47) | (221) |
| Net proceeds from sale of associate | 170 | ||||
| Loan repayments received from joint ventures and associates | 3 | 6 | |||
| Loan from joint ventures and associates | 8 | ||||
| Repayments of loan from joint ventures and associates | (3) | (4) | |||
| Proceeds from sale of financial investments | 23 | 10 | 90 | 28 | |
| Investments in financial investments | (25) | (7) | (201) | (41) | |
| Dividend received (financial investments) | 1 | ||||
| Interest received | 1 | 2 | |||
| Changes in other investments | (1) | (2) | |||
| Net cash flow provided by/(used in) investing activities | (16) | 4 | (142) | (54) | |
| Cash flow from financing activities | |||||
| Proceeds from issue of debt | 122 | 414 | |||
| Repayment of debt | (29) | (75) | (100) | (397) | |
| Repayments of loan from related party | (24) | (26) | |||
| Interest paid including interest derivatives | (20) | (28) | (81) | (100) | |
| Cash from other financial derivatives | (3) | (3) | (4) | 9 | |
| Dividend to shareholders | (27) | (39) | (177) | (63) | |
| Net cash flow provided by/(used in) financing activities | (80) | (169) | (240) | (164) | |
| Net increase in cash and cash equivalents | (40) | (139) | (187) | 52 | |
| Cash and cash equivalents, excluding restricted cash, at beginning of period | 197 | 483 | 344 | 292 | |
| Currency on cash and cash equivalents* | |||||
| Cash and cash equivalents at end of period | 157 | 344 | 157 | 344 |
* The group is located and operating world wide and every entity has several bank accounts in different currencies. Unrealised currency effects are included in net cash provided by operating activities.
The above consolidated cash flow statement should be read in conjunction with the accompanying notes.
Joint ventures based on equity method
| Balance 31.12.2013 | 30 | 89 | (3) | 1 513 | 1 632 |
|---|---|---|---|---|---|
| Paid dividends to shareholders | (177) | (177) | |||
| Other comprehensive income | (8) | (8) | |||
| Profit for the year | 272 | 272 | |||
| Balance at 01.01.2013 | 30 | 89 | 4 | 1 418 | 1 544 |
| USD mill | Share capital | Premium fund | Other reserves | Retained earnings |
Total equity |
| USD mill | Share capital | Premium fund | Other reserves | Retained earnings |
Total equity |
|---|---|---|---|---|---|
| Balance at 31.12.2011 | 30 | 485 | 3 | 686 | 1 207 |
| Remeasurement postemployment benefits, net of tax | (10) | (10) | |||
| Balance 01.01.2012 | 30 | 485 | 3 | 676 | 1 197 |
| Profit for the year Other comprehensive income |
1 | 409 | 409 1 |
||
| Total comprehensive income | 0 | 0 | 1 | 409 | 410 |
| Reduction premium fund Paid dividends to shareholders |
(395) | 395 (63) |
0 (63) |
||
| Balance 31.12.2012 | 30 | 89 | 4 | 1 418 | 1 544 |
In accordance with the board of directors' proposal, the extraordinary general meeting held on 6 December 2011 resolved that the company's share premium reserve should be reduced with USD 395 million (NOK 2.3 billion). The reduction of the share premium reserve was registered in the Norwegian business registration, Brønnøysund Registration Centre 10 March 2012.
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Joint ventures based on equity method
This consolidated interim financial report has been prepared in accordance with International Accounting Standards (IAS 34), "interim financial reporting". The consolidated interim financial reporting should be read in conjunction with the annual financial statements for the year end 31 December 2012 for Wilh.Wilhelmsen ASA group (WWASA), which has been prepared in accordance with IFRS's endorsed by the EU. The accounting policies implemented are consistent with those of the annual financial statements for WWASA for the year end 31 December 2012. WWASA implemented IAS19R as of 1 January 2013 and and the impact was to
eliminate the corridor to other comprehensive income. The changes are made with
retrospective application. The effect on income statement and comprehensive income for first quarter 2012 and 2013 are not material. The main changes to previously reported numbers are shown in statement of equity and table below.
There are no new standards or amendments to standards released during 2013.
As a result of rounding adjustments, the figures in one or more columns may not add up to the total of that column.
| Share of profit from joint ventures | 0,1 | |
|---|---|---|
| Employee benefit expense | 0,6 | |
| Other comprehensive income, net after tax | 1,4 | |
| 01.01.2012 | 31.12.2012 | |
| The balance sheet effect | ||
| Investment in joint ventures and associates | (1,4) | 0,1 |
| Pension liabilities | 12,4 | 11,8 |
| Deferred tax liabilities | (3,5) | (3,3) |
| Equity attributable to owners of the parent | (10,3) | (8,3) |
2013 - There has not been any significant acquisitions or disposals during 2013.
2012 - In the third quarter of 2012, WWASA sold 937 500 shares in Hyundai Glovis with net proceeds of approximately USD 170 million. The net gain recorded in the 2012 group's accounts amounted to USD 134 million.
Joint ventures based on equity method
| USD mill | Other tangible assets |
Vessels & Newbuilding contracts |
Total tangible assets |
Intangible assets |
|---|---|---|---|---|
| 2013 | ||||
| Cost price 01.01 | 2 | 2 508 | 2 510 | 8 |
| Additions | 47 | 47 | ||
| Disposal | (88) | (89) | (1) | |
| Cost price 31.12 | 2 | 2 467 | 2 469 | 7 |
| Accumulated depreciation and impairment losses 01.01 Depreciation |
(1) | (641) (82) |
(643) (82) |
(2) |
| Disposal | 76 | 76 | 1 | |
| Accumulated depreciation and impairment losses 31.12 | (1) | (647) | (649) | (1) |
| Carrying amounts 31.12 | 1 | 1 820 | 1 821 | 6 |
| 2012 | ||||
| Cost price 01.01 | 2 | 2 298 | 2 301 | 8 |
| Additions | 221 | 221 | ||
| Disposal | (1) | (10) | (11) | |
| Cost price 31.12 | 2 | 2 508 | 2 510 | 8 |
| Accumulated depreciation and impairment losses 01.01 Depreciation Disposal |
(2) | (568) (83) 10 |
(571) (83) 11 |
(2) |
| Accumulated depreciation and impairment losses 31.12 | (1) | (641) | (643) | (2) |
| Carrying amounts 31.12 | 1 | 1 868 | 1 868 | 6 |
Joint ventures based on equity method
| USD mill | 01.10-31.12 | 01.10-31.12 | YTD | YTD |
|---|---|---|---|---|
| 2013 | 2012 | 2013 | 2012 | |
| Financials | ||||
| Investment management 1 | 5,2 | 1,9 | 13,3 | 8,8 |
| Interest incomes | 0,4 | 0,5 | 1,3 | 1,6 |
| Other financial items | (0,4) | 3,1 | (1,6) | (2,7) |
| Net financial items | 5,1 | 5,4 | 13,0 | 7,7 |
| Net financials - interes rate | ||||
| Interest expenses | (11,4) | (11,8) | (44,7) | (50,7) |
| Interest rate derivatives - realised | (13,1) | (19,3) | (36,2) | (47,0) |
| Net interest expenses | (24,6) | (31,1) | (80,9) | (97,7) |
| Interest rate derivatives - unrealised | 17,8 | 20,6 | 68,3 | 8,5 |
| Net financial - currency | ||||
| Net currency gain/(loss) | 5,7 | (7,7) | 46,3 | (30,3) |
| Currency derivatives - realised | (4,1) | (4,1) | (7,3) | 5,7 |
| Currency derivatives - unrealised | (1,2) | 3,4 | (13,7) | 6,3 |
| Cross currency derivatives - realised | 1,0 | 0,7 | 3,4 | 3,3 |
| Cross currency derivatives - unrealised | (2,6) | 4,2 | (19,8) | 14,6 |
| Net financial - currency | (1,2) | (3,4) | 8,9 | (0,4) |
| Financial income/(expenses) | (2,8) | (8,5) | 9,4 | (81,9) |
1 Includes financial derivatives for trading
Wilhelmsen Lines Shipowning (WLS) has commenced legal proceedings before Oslo City Court on basis of the tax appeal board's decision to turn down the application for tonnage tax. Basis for the proceedings is that the transition rule valid for companies that exited the old tonnage tax regime (abolished in 2007) into ordinary taxation, is in breach with The Constitution article 97. Such claim is in line with the decision by the Norwegian Supreme Court in the ruling of February 2010 that the transition rule valid for companies that exited the old tonnage tax regime into the new tonnage tax system was in breach with the constitution. Alternatively WLS claim a compensation for the economic loss caused by the unconstitutional transition rule. WLS had to choose between two transition rules which both
originally was claimed by the authorities to be constitutional. WLS choice to exit into ordinary taxation was hence based on wrong assumptions.
Until we face the final outcome of the litigation process, this case will have no impact on the income statement or balance sheet for the group.
The effective tax rate for the group will, from period to period, change dependent on the group gains and losses from investments inside the exemption method and tax exempt revenues from tonnage tax regimes.
After the restructuring and IPO the company's share capital is as follows:
Number of shares NOK mill USD mill Share capital 220 000 000 220 30
Joint ventures based on equity method
Dividend for fiscal year 2012 of NOK 4.00 per share, total of approximately USD 150 million, was paid to the shareholders in May 2013. The dividend had effect on retained earnings and other reserves in the second quarter of 2013.
Based on the company's distributable equity as of 31 December 2012 (less dividend paid in the first half of 2013), an additional dividend of NOK 0.75 per share, total of approximately USD 27 million, was paid in December 2013. The dividend had effect on retained earnings and other reserves in fourth quarter
The proposed dividend for fiscal year 2013 in 2014 is NOK 1.00 per share, payable in the second quarter of 2014. A decision on this proposal will be taken by the annual general meeting on 24 April 2014. The proposed dividend is not accrued in the year-end balance sheet.
| USD mill | 31.12.2013 | 31.12.2012 |
|---|---|---|
| Non current interest-bearing debt | 1 320 | 1 417 |
| Current interest-bearing debt | 182 | 117 |
| Total interest-bearing debt | 1 502 | 1 534 |
| Cash and cash equivalents | 157 | 344 |
| Current financial investments | 254 | 130 |
| Net interest bearing debt | 1 092 | 1 060 |
| Net interest bearing debt in Joint Ventures (group's share) | 31.12.2013 | 31.12.2012 |
| Non current interest-bearing debt | 550 | 564 |
| Current interest-bearing debt | 95 | 103 |
| Total interest-bearing debt | 646 | 667 |
| Cash and cash equivalents | 266 | 227 |
| Current financial investments | ||
| Net interest bearing debt | 380 | 440 |
| Specification of interest-bearing debt | 31.12.2013 | 31.12.2012 |
| Interest-bearing debt | ||
| Mortgages* | 974 | 1 086 |
| Leasing commitments | 90 | 96 |
| Bonds | 439 | 352 |
| Total interest-bearing debt | 1 502 | 1 534 |
| *Of which JV loan was USD 0 as of 30.09.2013 (USD 14 million as per 31.12.2012) | ||
| Repayment schedule for interest-bearing debt | ||
| Due in year 1 | 183 | 117 |
| Due in year 2 | 98 | 191 |
| Due in year 3 | 399 | 98 |
| Due in year 4 | 79 | 418 |
| Due in year 5 and later | 743 | 710 |
| Total interest-bearing debt | 1 502 | 1 534 |
Joint ventures based on equity method
| USD mill | Level 1 | Level 2 | Level 3 | Total |
|---|---|---|---|---|
| Financial assets at fair value | ||||
| Financial derivatives | 0 | |||
| Equities | 59 | 59 | ||
| Bonds | 179 | 15 | 0 | 194 |
| Available-for-sale financial assets | 4 | 4 | ||
| Other financial assets | 0 | |||
| Total financial assets 31.12.2013 | 242 | 15 | 0 | 258 |
| Financial liabilities at fair value | ||||
| Financial derivatives | 99 | 99 | ||
| Total financial liabilities 31.12.2013 | 0 | 99 | 0 | 99 |
| Financial assets at fair value | ||||
| Financial derivatives | 32 | 32 | ||
| Bonds | 129 | 0 | 130 | |
| Available-for-sale financial assets | 5 | 5 | ||
| Other financial assets | 0 | |||
| Total financial assets 31.12.2012 | 134 | 32 | 0 | 166 |
| Financial liabilities at fair value | ||||
| Financial derivatives | 166 | 166 | ||
| Total financial liabilities 31.12.2012 | 0 | 166 | 0 | 166 |
| 2013 | 2012 | |||
| Changes in level 3 instruments | ||||
| Opening balance 01.01 | 0 | 3 | ||
| Disposals | (2) | |||
| Gains and losses recognised through income statement | (1) | |||
| Closing balance | 0 | 0 |
Level 1 are quoted prices in active markets, level 2 are input other than quoted prices included within level 1 that are observable either directly or indirectly and
Wilh. Wilhelmsen Holding ASA (WWH) delivers services to the WWASA group related to inter alia human resources, tax, communication, treasury and legal services ("Shared Services") and in-house services such as canteen, post, switchboard and rent of office facilities. In addition, according to service level agreements, WWASA delivers accounting services to WWH. Generally, Shared Services are priced using a cost plus 5% margin calculation, in accordance with
At the end of October 2013, American Auto Logistics (AAL, owned by ASL) was informed that the company was not awarded the Global Privately Owned Vehicle (POV) contract for the US Department of Defense.
finally level 3 are assets or liabilities that are not based on observable market data.
the principles set out in the OECD Transfer Pricing Guidelines and are delivered according to agreements that are renewed annually.
In addition, WWASA group has several transactions with associates. The contracts governing such transactions are based on commercial market terms and mainly relate to the chartering of vessels on short and long term charters.
The company filed a protest with the US General Accountability Office, which has been denied. AAL has initiated a legal process whereby it is challenging this decision.
Joint ventures based on equity method
| USD mill | Shipping | Logistics | Holding | Eliminations | Total | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Full | Full | Full | Full | Full | |||||||||||
| Q4 | Q4 | year | Q4 | Q4 | year | Q4 | Q4 | year | Q4 | Q4 | year | Q4 | Q4 | year | |
| QUARTER | 2013 | 2012 | 2012 | 2013 | 2012 | 2012 | 2013 | 2012 | 2012 | 2013 | 2012 | 2012 | 2013 | 2012 | 2012 |
| Total income | 83 | 87 | 394 | 2 | 2 | 7 | (1) | (1) | (6) | 83 | 88 | 395 | |||
| Share of profit from joint ventures | |||||||||||||||
| and associates 1 | 10 | 32 | 149 | 23 | 18 | 82 | 32 | 51 | 230 | ||||||
| Gain on sale of assets | 1 | 134 | 1 | 134 | |||||||||||
| Total income | 94 | 120 | 542 | 23 | 18 | 215 | 2 | 2 | 7 | (1) | (1) | (6) | 117 | 138 | 759 |
| Primary operating profit | 56 | 80 | 386 | 23 | 18 | 215 | (3) | (3) | (9) | 76 | 96 | 592 | |||
| Depreciation and impairment | (21) | (21) | (83) | (21) | (22) | (83) | |||||||||
| Operating profit (EBIT) | 36 | 59 | 303 | 23 | 18 | 215 | (3) | (3) | (10) | 0 | (0) | (0) | 56 | 74 | 508 |
| Financial income/(expense) | (2) | (4) | (62) | (1) | (5) | (20) | (3) | (8) | (82) | ||||||
| Profit/(loss) before tax | 34 | 55 | 241 | 23 | 18 | 215 | (4) | (8) | (29) | 0 | (0) | (0) | 53 | 66 | 427 |
| Tax income/(expenses) | 10 | (30) | (24) | 4 | 2 | 7 | 14 | (28) | (17) | ||||||
| Profit/(loss) for the period | |||||||||||||||
| attributable to the owners of the | |||||||||||||||
| parent | 44 | 26 | 217 | 23 | 18 | 215 | 0 | (6) | (23) | 0 | (0) | (0) | 67 | 38 | 410 |
| USD mill | Shipping | Logistics | Holding | Eliminations | Total | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| YTD | YTD | YTD | YTD | YTD | YTD | YTD | YTD | YTD | YTD | |
| Year to date | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 |
| Total income | 324 | 394 | 6 | 7 | (5) | (6) | 325 | 395 | ||
| Share of profit from joint ventures | ||||||||||
| and associates 1 | 95 | 149 | 88 | 82 | 182 | 230 | ||||
| Gain on disposal of assets | 1 | 134 | 1 | 134 | ||||||
| Total income | 420 | 542 | 88 | 215 | 6 | 7 | (5) | (6) | 508 | 759 |
| Primary operating profit | 262 | 386 | 88 | 215 | (12) | (10) | 337 | 592 | ||
| Depreciation and impairment | (82) | (83) | (82) | (83) | ||||||
| Operating profit | 179 | 303 | 88 | 215 | (12) | (10) | 0 | (0) | 255 | 508 |
| Financial income/(expenses) | 4 | (62) | 6 | (21) | 9 | (82) | ||||
| Profit/(loss) before tax | 183 | 241 | 88 | 215 | (7) | (30) | 0 | (0) | 264 | 427 |
| Tax income/(expense) | 3 | (24) | 4 | 6 | 7 | (17) | ||||
| Profit/(loss) for the period | ||||||||||
| attributable to the owners of the | ||||||||||
| parent | 186 | 217 | 88 | 215 | (2) | (23) | 0 | (0) | 272 | 410 |
1 Cash settled portion of bunker hedge swaps is included in net operating profit by reduction/(increase) of voyage related expenses
Joint ventures based on equity method
The group's joint ventures Wallenius Wilhelmsen Logistics AS (WWL) and EUKOR Car Carriers Inc (EUKOR) are subject to an anti‐ trust investigation of the car carrying industry in several jurisdictions. In January 2014, the Japanese Fair Trade Commission (JFTC) issued a draft cease and desist order and a draft surcharge order indicating that WWL as one of several companies in the car carrying industry has participated in non‐competitive behavior in automotive transportation. The draft surcharge for WWL's account is estimated to USD 33 million and primarily related to the Japan‐ Europe trade (WWASA's share USD 16.5 million).
The draft cease and desist order and draft surcharge order are provided to the companies concerned for their review and comment, in advance of a final ruling by the JFTC, which WWL expects to receive in the second quarter.
EUKOR was initially included in the investigation, but has been dropped from the investigation by the JFTC.
Cost of process management related to this investigation is charged on an ongoing basis. Except the accrual of USD 16.5 million related to the draft surcharge order from JFTC, no other accruals or reserves have been charged to the accounts in the fourth quarter.
The company has not received any further information on ongoing investigations from other jurisdictions, but WWL and EUKOR have and will cooperate and respond to any questions authorities might have.
Wilh. Wilhelmsen ASA PO Box 33 NO-1324 Lysaker, NORWAY Tel: +47 67 58 40 00 www.wilhelmsenasa.com
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Org no 995 216 604 MVA
| WWASA Profit & Loss Q4 2013 > |
||||||
|---|---|---|---|---|---|---|
| Proportionate method | ||||||
| USD mill | 2013 Q4 | 2013 Q3 | 2013 FY | 2012 FY | 2012 Q4 | |
| Operating income | 610 | 612 | 2 460 | 2 758 | 647 | |
| Gain on sale of assets | 1 | 1 | 134 | 0 | ||
| Share of profits from JV's and associates | 19 | 15 | 62 | 57 | 12 | |
| Total income | 630 | 627 | 2 523 | 2 949 | 659 | |
| EBITDA | 105 | 116 | 445 | 697 | 120 | |
| Depreciation and impairments | EBIT adjusted MUSD 82 | (39) | (38) | (152) | (150) | (38) |
| EBIT | 66 | 78 | 293 | 548 | 81 | |
| Financial income/(expense) | (8) | (14) | (8) | (99) | (11) | |
| Profit/(loss) before tax | 58 | 64 | 285 | 448 | 71 | |
| Net profit 1) | 1 67 |
59 | 1 272 |
1 410 |
1 38 |
|
| Earnings per share | 0,30 | 0,27 | 1,23 | 1,86 | 0,17 | |
| 1) after minority interest | ||||||
| USD mill | 2013 Q4 | 2013 Q3 | 2013 FY | 2012 FY |
|---|---|---|---|---|
| Net fi nancial i tems | 5,7 | 9,1 | 15,9 | 11,6 |
| Net interes t expenses | (29,3) | (24,3) | (99,3) | (120,9) |
| Interes t rate derivatives - unreal is ed | 18,7 | 2,3 | 71,2 | 11,4 |
| Net fi nancial - currency | (1,0) | (0,3) | 7,7 | 0,3 |
| Net fi nancial deri vati ve s bunkers | (2,5) | (0,6) | (3,2) | (1,8) |
| Financial income/(expense) | (8,4) | (13,9) | (7,7) | (99,6) |
| • Good return on excess liquidity • Increase in net interest expenses caused by termination of two interest rate swaps • Unrealized gain on interest rate derivatives due to higher long term USD interest rates |
| USD mill | 31.12.2013 | 30.09.2013 | 31.12.2012 | |||
|---|---|---|---|---|---|---|
| Assets | ||||||
| Non current assets | 2 952 | 87 % | 2 936 | 86 % | 2 897 | 85 % |
| Current assets (excl liquid funds) | 25 | 1 % | 30 | 1 % | 37 | 1 % |
| Liquid funds | 411 | 12 % | 442 | 13 % | 474 | 14 % |
| Total assets | 3 388 | 100 % | 3 408 | 100 % | 3 407 | 100 % |
| Equity & liabilities | ||||||
| Equity | 1 632 | 48 % | 1 600 | 47 % | 1 544 | 45 % |
| Non current interest-bearing debt | 1 320 | 39 % | 1 438 | 42 % | 1 417 | 42 % |
| Other non current liabilities | 206 | 6 % | 233 | 7 % | 285 | 8 % |
| Current liabilities | 229 | 7 % | 137 | 4 % | 161 | 5 % |
| Total equity and liabilities | 3 388 | 100 % | 3 408 | 100 % | 3 407 | 100 % |
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