Norway's Fred Olsen group has revealed it made a substantial loss on selling two idle cruiseships as it renewed the fleet in the third quarter.
The group's Oslo-listed holding company, Bonheur, said in its results statement on Friday that the cruise division Fred Olsen Cruise Lines booked an impairment of NOK 187m ($20.2m). The charge was tied to the disposal of the 28,600-gt sisterships Black Watch (built 1972) and Boudicca (built 1973) this month.
The duo went for an undisclosed sum to Turkish interests for use as accommodation ships.
VesselsValue assesses the pair as worth less than $12m combined.
The impairment reflected estimated difference between book values and net sales proceeds, Bonheur said.
The cruise division posted an Ebitda loss of NOK 141m in the third quarter, against a profit of NOK 157m a year ago.
Revenue was zero, compared to NOK 715m the year before.
The net loss was NOK 405m, from a profit of NOK 96m in 2019.
In July, the group bought the 1,380-berth Amsterdam (built 2000) and 1,404-berth Rotterdam (built 1997) from Carnival Cop's Holland America Line for a combined $37m. These have been renamed Borealis and Bolette.
Runway to the future
"The fleet renewal creates a solid runway until greener propulsion technologies become available," Bonheur said.
Estimated lay-up costs and overhead costs for the idled cruiseships in Scotland are £3m ($3.9m) per month.
Bonheur is reporting solid demand for cruises in 2021, but the vessels will remain in lay-up until it is safe for guests and crew to resume cruising, the company added.
The shipping and offshore wind division produced Ebitda of NOK 151m, down from NOK 289m a year ago.
Net profit was NOK 47m, versus NOK 92m in 2019.
Use of wind ships drops
The company controls three jack-up wind farm installation ships, and charters in a fourth.
Utilisation fell to 70% from 99% last year.
Bonheur's overall net loss was NOK 398.5m, against a profit of NOK 30.2m in 2019.
Revenue fell to NOK 1.37bn, compared to NOK 2.23bn the year before.
Gross interest-bearing debt was NOK 11.6bn, up NOK 991m since June.
This is mainly due to a new green bond loan of NOK 700m issued in September and a NOK 272m seller's credit from the purchase of the two cruiseships.
Cash and cash equivalents amounted to NOK 5.2bn.
