Smit sales ahead in 2008

By Euan Youdale09 March 2009

Marine salvage, transport and heavy lift specialist Smit International recorded an "exceptional" 2008 financial year, notably in its heavy lift segment.

The division saw revenue increase from €88 million (US$111 million) at the end of 2007 to €156.1 million ($197 million) during 2008. Its operating result stood at €19.5 million ($24.6 million), compared to €1 million ($1.3 million) in 2007. Profit margin was 13%, up from 1% the year before.

"The heavy lift activities of this division (transport and heavy lift) achieved an exceptionally good result during the second half of the year. The floating sheerlegs, marine projects and subsea activities all experienced a very high supply of work during that period. The improvement in the results compared with the first six months stemmed, in part, from postponed projects and the performance of maintenance work early in the year," said the company.

Late in 2008, a five-year contract commenced in Qatar and jack-up barge Lisa A became operational following protracted repairs during the second half of the year.

In addition, the high demand for services from Asian shipyards allowed the Asian Lift joint venture to record an excellent result, Smit added.

The group operating result rose 19% against the 2007 figure, from €94.7 to 112.5 million ($119.6 to 142 million), while net profit increased from €105 to 107.8 million ($133 to 136.2 million). EBITDA, including associated companies, rose 26% from €159.4 to 201 million ($201.4 to 254 million).

However, net profit per share decreased 9% from €6.68 to €6.11, "Owing to the issuing of shares," said the company.

"We are proud that we have managed to exceed the record results of 2007, despite a major increase in our depreciation charges and the low US dollar rate. The growth was largely realised through our less cyclical activities. This underlines the success of the strategy we adopted of synergy and focusing on our more stable activities" explained Ben Vree, Smit CEO.

"However, the economic downturn will not leave us unaffected, particularly in the harbour towage activities owing to the diminishing number of vessel movements, and in the spot activities of transport and heavy Lift. At the same time, the declining market will also offer opportunities for takeovers, which will accelerate consolidation in the sector," Vree added.

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