OSG Reports Fiscal 2007 and Fourth Quarter Results
OSG Reports Fiscal 2007 and Fourth Quarter Results Tuesday February 26, 5:10 pm ET HIGHLIGHTS -- TCE revenues were $251.8 million, an increase from $241.6 million quarter-over-quarter -- Net income was $21.0 million, a decline from $113.2 million quarter-over-quarter -- Diluted EPS was $0.67 compared with $2.86 quarter-over-quarter -- 8.3 million shares repurchased during fiscal 2007 or 20.9% of total shares outstanding -- Sale of 24.5% limited partner interest in OSG America L.P. completed, enhancing visibility of U.S. Flag fleet
NEW YORK--(BUSINESS WIRE)--Overseas Shipholding Group, Inc. (NYSE: OSG - News), a market leader in providing energy transportation services, today reported results for the fiscal year and fourth quarter of 2007.
For the fiscal year ended December 31, 2007, the Company reported a 5% increase in time charter equivalent1 (TCE) revenues to $1,039.2 million from $992.8 million in 2006. Although net income declined $181.4 million, or 46%, to $211.3 million for the fiscal year 2007 compared with $392.7 million in fiscal 2006, EBITDA1 in the same period decreased 20% to $476.3 million from $595.1 million in 2006. Diluted earnings per share declined 38% to $6.16 per share in 2007 from $9.92 per diluted share a year ago. In 2007, gains on vessel sales and sale of securities totaled $48.3 million, or $0.99 per diluted share, compared with $74.1 million, or $1.56 per diluted share, in 2006.
For the quarter ended December 31, 2007, TCE revenues were $251.8 million, an 4% increase from $241.6 million for the same period of 2006. The growth in TCE revenues reflects an increase of 1,600 revenue days across all segments of the Company’s fleet (see Spot and Time Charter TCE Rates Achieved and Revenue Days table, found later in this release). The impact of this increase in days was substantially offset by higher fuel costs and a significant weakening in spot rates for the Company’s VLCCs, Aframaxes and Handysize Product Carriers as the market switched from contango (when the price of oil in the futures market is higher than the current market price) to backwardation (when the current market price of oil is higher than the futures market). The switch to backwardation adversely impacted seaborne crude oil movements in all tanker categories as it became more economical for refiners to drawdown on crude oil inventories. Rates for VLCCs, Aframaxes and Handysize Product Carriers fell to their lowest levels in the last three years in early November before picking up significantly in late November. EBITDA for the quarter decreased 48% to $88.9 million from $170.3 million in the comparable period of 2006. Net income for the period decreased to $21.0 million, and diluted EPS decreased to $0.67 per share compared with $113.2 million, or $2.86 per diluted share, for the same period a year ago. Net income in the fourth quarter of 2006 benefited from gains on vessel sales and sale of securities of $53.1 million, or $1.12 per diluted share. Period-over-period diluted EPS also benefited from the Company’s repurchase of 21.7% of total shares outstanding since September 2006.
1See Appendix 1 for a reconciliation of TCE revenues to shipping revenues and Appendix 2 for a reconciliation of EBITDA to net income.
TCE revenues in the fourth quarter of 2007 for the International Crude Oil Tanker segment were $134.8 million, a decrease of $20.5 million, or 13%, from $155.3 million, in the same period of 2006. The decrease was principally due to significant declines in the daily TCE rates earned for the VLCCs and Aframaxes, partially offset by the inclusion of the results of Heidmar Lightering from April 1, 2007. TCE revenues for the International Product Carrier segment were $59.4 million, up $5.0 million, or 9%, from $54.4 million in the year earlier period. The