Ship Finance International Limited (NYSE: SFL) – Earnings Release
Reports preliminary 2Q 2011 results and quarterly dividend of $0.39 per share
Hamilton, Bermuda, August 25, 2011. Ship Finance International Limited (“Ship Finance” or the “Company”) today announced its preliminary financial results for the quarter ended June 30, 2011.
The Board of Directors declared a quarterly dividend of $0.39 per share.
Net income for the quarter was $41.5 million, or $0.52 per share, including an accrued profit share in the second quarter of $0.2 million.
Two old combination carriers and a jack-up drilling rig were sold in the quarter with an aggregate gain on sales of approximately $9.9 million.
The Company took delivery of the second 2010-built 13,800 teu container vessel to CMA-CGM with 15-year time charter.
The Company contracted four newbuilding 4,800 teu container vessels in the quarter. Delivery is scheduled in 2013 and the vessels have already been chartered out for seven years from delivery.
Bank financing has been arranged for all vessels under construction and is expected to be higher than the remaining yard installments.
Dividends and Results for the Quarter Ended June 30, 2011
The Board of Directors has declared a quarterly cash dividend of $0.39 per share. Ship Finance has now paid dividends for 30 consecutive quarters. The dividend will be paid on or about September 29, 2011 to shareholders of record as of September 9, 2011. The ex-dividend date will be September 7, 2011.
The Company reported total U.S. GAAP operating revenues on a consolidated basis of $73.8 million, or $0.93 per share, in the second quarter of 2011. This number excludes $25.0 million of charter hire classified as ‘repayment of investments in finance lease’, and also excludes $104.3 million of charter revenues earned by assets classified as ‘investment in associate’.
The profit share income in the second quarter was $0.2 million compared to $2.3 million in the first quarter of 2011. The reduced profit share was a result of a continued weak tanker market in the second quarter. The Company recorded a gain on sale of assets of $9.9 million in the quarter, including $4.1 million classified as ‘gain on sale of associate’ related to the sale of a jack-up drilling rig accounted for as ‘investment in associate’.
Reported net operating income pursuant to U.S. GAAP for the quarter was $44.6 million, or $0.56 per share, and reported net income was $41.5 million, or $0.52 per share.
Ole B. Hjertaker, Chief Executive Officer of Ship Finance Management AS said in a comment: “This has been another active quarter for the Company, where we have taken delivery of a 13,800 teu container vessel, contracted four newbuilding 4,800 teu container vessels and sold one jack-up drilling rig and two older combination carriers. We have also sourced financing for the whole newbuilding program, where net proceeds from the financing will exceed remaining installments.”
Mr. Hjertaker continued: “We continue to develop our fleet and backlog of fixed rate charters, which as of June 30, 2011 was approximately $6.9 billion, and with more than 11 years of remaining charter term if weighted by charter revenue. The Company has a strong balance sheet and the recently announced financings demonstrate our premium access to the capital markets. We are therefore well positioned for continued selective growth within our core segments, while always maintaining our conservative profile”.
The full report can be found in the link below.
August 25, 2011
The Board of Directors
Ship Finance International Limited
Questions should be directed to:
Investor and Analyst Contact:
Eirik Eide, Chief Financial Officer, Ship Finance Management AS
+47 23114006 / +47 95008921
Magnus T. Valeberg: Vice President, Ship Finance Management AS
+47 23114012 / +47 93440960
Ole B. Hjertaker, Chief Executive Officer, Ship Finance Management AS
+47 23114011 / +47 90141243
Forward Looking Statements
This press release contains forward looking statements. These statements are based upon various assumptions, many of which are based, in turn, upon further assumptions, including Ship Finance management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties. Although Ship Finance believes that these assumptions were reasonable when made, because assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, Ship Finance cannot give assurance that it will achieve or accomplish these expectations, beliefs or intentions.
Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies, fluctuations in currencies and interest rates, general market conditions including fluctuations in charter hire rates and vessel values, changes in demand in the markets in which we operate, changes in demand resulting from changes in OPEC’s petroleum production levels and worldwide oil consumption and storage, developments regarding the technologies relating to oil exploration, changes in market demand in countries which import commodities and finished goods and changes in the amount and location of the production of those commodities and finished goods, increased inspection procedures and more restrictive import and export controls, changes in our operating expenses, including bunker prices, drydocking and insurance costs, performance of our charterers and other counterparties with whom we deal, timely delivery of vessels under construction within the contracted price, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents or political events, and other important factors described from time to time in the reports filed by the Company with the Securities and Exchange Commission.
Links to the full report and a webcast presentation of accounting items can be found below: