SFL – Fourth Quarter 2006 Results

 

 

 

Ship Finance International Limited (“Ship Finance” or the “Company”) announces today the preliminary financial results for the fourth quarter and year ended December 31, 2006.

 

 

The Board of Directors has declared a cash dividend of $0.54 per share with respect to the fourth quarter of 2006, up from $0.53 per share for the previous quarter. For the year 2006, a total of $2.09 per share has been declared – an increase of 4.5% compared to 2005.

Total operating revenues for the quarter were $118.4 million or $1.63 per share. Net income was $57.8 million or $0.79 per share.

For the year 2006, there will be a profit share payment from Frontline Ltd. (“Frontline”) of $78.9 million or $1.08 per share

The single-hull VLCC “Front Tobago” was sold and delivered to its new owners in December 2006, and in January 2007 the Company agreed to sell six additional single-hull vessels. Following these sales, the number of single-hull vessels in the fleet will be reduced from 18 to 11 vessels over a period of three months.

In January 2007, Ship Finance announced the acquisition of a newbuilding jack-up drilling rig for a purchase price of $210 million, in combination with a 15 year charter to Seadrill Limited (“Seadrill”). The rig is scheduled to be delivered from the shipyard in July 2007.

In February 2007, the Company announced the acquisition of two newbuilding 170,000 dwt dry bulk vessels for a total delivered cost price of $160 million, in combination with 15 year charters to Golden Ocean Group Limited (“Golden Ocean”). The vessels are scheduled to be delivered from the shipyard in the fourth quarter of 2008 and the first quarter of 2009.

 

 

The Board of Directors has reviewed the long term prospects for the Company including its significant fixed charter backlog and growth prospects, and decided to increase the dividend payment for the quarter to $0.54 per share. The dividend will be paid on March 22, 2007 to shareholders of record as of March 8, 2007. The ex-dividend date is March 6, 2007.

 

The Company reported total operating revenue of $118.4 million, operating income of $80.7 million and net income of $57.8 million for the fourth quarter of 2006. Earnings per share for the quarter were $0.79.

 

Cash provided by operating activities in the fourth quarter was $35.8 million, net cash provided by investing activities was $7.7 million and net cash used in financing activities was $18.5 million. 

 

For the year 2006, operating revenue was $415.2 million, operating income was $284.3 million and net income was $180.8 million. Earnings per share for the year were $2.48.

 

For the fourth quarter, operating revenues include $35.9 million of profit share due from Frontline with respect to vessels under long term charter agreements. Of the $35.9 million, $15 million accrued during the fourth quarter, while the remaining $20.9 million was accrued during the first nine months of the year but had not been recognized under US GAAP. For the year 2006, a total of $78.9 million in profit share has accrued, and this amount is due from Frontline in March 2007.

 

As of December 31, 2006, the Company had total cash and cash equivalents of $56.6 million and restricted cash of $12.9 million. In addition, $8.4 million in cash and cash equivalents was held in 100% owned subsidiaries accounted for under the equity method, based on US GAAP. At year-end, the Company had available undrawn credit lines in the amount of $146.7 million.

 

The full report is available in the link below.

 

February 27, 2007

The Board of Directors

Ship Finance International Limited

Hamilton, Bermuda

 

Questions should be directed to:

 

Lars Solbakken: Chief Executive Officer, Ship Finance Management AS

+47 23114006 / +47 91198844

 

Ole B. Hjertaker: Chief Financial Officer, Ship Finance Management AS

+47 23114011 / +47 90141243