Russian state tanker and LNG carrier owner Sovcomflot (SCF Group) returned to profit in 2019 as it clinched financing worth more than $1bn.
The company, which is aggressively expanding its fleet, said net profit for the year was $225.4m, against a loss of $45.6m in 2018.
Revenue grew to $1.66bn from $1.51bn in strong tanker and gas markets.
Chief financial officer Nikolay Kolesnikov said its business model provided for resilient financial performance and has allowed the company to maintain strong relationships with its financiers for many years.
It has a pool of more than 20 lenders, as well as institutional investors in its unsecured euro bonds.
“Access to debt capital through the cycle allows the company to successfully implement strategic plans to expand its portfolio of long-term industrial contracts, which are characterised by the stability and good visibility of future cash flows and attractive financial returns," he added.
More than $1bn banked
"In the reporting period, Sovcomflot raised over $1bn of longer-term debt capital, to finance its current investment programme and to refinance SCF’s maturing debt obligations, including its first financing under the Poseidon Principles."
He added: "The company's strong performance indicators in 2019 resulted in a further strengthening of its liquidity position and significant improvement of all key credit metrics.”
It had previously reported a $297m loan facility agreed with a consortium of major banks to finance two newbuildings.
ING Bank, KfW IPEX-Bank and Credit Agricole Corporate and Investment Bank have provided the funds, which will go towards pre- and post-delivery financing for two of Sovcomflot's Atlanticmax LNG carriers.
It also arranged more financing with domestic lender VEB.RF Group for new tankers.
VEB Leasing will fund the construction of three LNG-fuelled MR ships at Russia's Zvezda Shipyard.
It had been earlier reported that deal was worth an estimated RUB 10bn ($152.4m).
And a joint venture company owned by Sovcomflot (SCF Group) and NYK Line revealed new financing for two Sakhalin-2 LNG carriers.
The Russian and Japanese operators are banking $176m over eight years from Sumitomo Mitsui Banking Corporation, Societe Generale and Shinsei Bank of Japan.
The cash will go towards refinancing the 145,000-cbm ice-class Grand Aniva (built 2008) and Grand Elena (built 2007), jointly owned by the companies.
It is not clear where the rest of the money came from.
Profit close to record levels
Chief executive Igor Tonkovidov called 2019 a successful year for the company.
"By many measures such as net profit and Ebitda, which amounted to $225.4m and $823m respectively, the results achieved in 2019 are close to our historic highs," he said.
"The strategy approved by the board of directors for the period to 2025 will see us maintaining our focus on expanding the portfolio of large-scale and long-term industrial projects, many of which are of great importance for the country's economy."
He added: "We will continue to place a strong emphasis on our technical capabilities and operations in challenging environments, which represent a unique competitive advantage for the company. Successful implementation of these plans will further enhance SCF’s business stability and the sustainability of our financial results."
The owner said it had achieved a balanced mix between its project-based and conventional businesses, which both ensures the sustainability of revenues and allows it to benefit from increased earnings in a healthy tanker freight market.
Green tankers delivered
This was the first year of operating three of its new LNG-fuelled Green Funnel aframax tankers.
It achieved up to 30% reduction of carbon dioxide (CO2) emissions, which exceeded its forecasts.
The group is also studying other alternative technologies that have the potential to further reduce the environmental impact of our operations, it said.
The group has signed shipbuilding contracts for two aframax shuttle tankers for the Sakhalin-1 project with deliveries in early 2022 backed by 10 and 15-year time charters.
And it has agreed long-term time-charter contracts with Russian energy company Novatek for three next-generation LNG-fuelled MR product carriers, currently under construction at Zvezda Shipbuilding Complex.
