Bergesen Releases 1Q Results

The Bergesen group generated firstquarter operating profit of $25.6 million, substantially down on the $104.3 million recorded last year. These figures include capital gains on the sale of vessels of $ 10.4 million in 2002 and $7.2 million in 2001.

Freight income on a T/C basis totalled $114.5 million, compared with $196.9 million in 2001.

The company's gas fleet generated first-quarter operating profit of $5.9 million, compared with $47.7 million last year. Earnings were sharply down on last year for the VLGCs, LGCs and MGCs and again weak for the Handygas and Igloo vessels.

Bergesen's VLGCs (over 70,000 cbm) generated average T/C income of $409,800/month, compared with $837,300/month last year. Charter cover for Bergesen's VLGC pool for the rest of 2002 stood at 21 percent at the end of the period.

At the end of the first quarter Bergesen finalized the agreement with Nigeria LNG Ltd. on the employment of four LNG carriers for a minimum of 20.5 years from delivery. At the same time Bergesen entered into an agreement with Daewoo Shipbuilding and Marine Engineering Co. Ltd. in South Korea on the construction of these vessels, all of 140,500 cbm. In May, Bergesen entered into a preliminary agreement with Sonatrach for employment of one LNGcarrier of 138,000 cbm for minimum 20 years from delivery. The vessel was ordered at Daewoo in June 2001. This means that Bergesen now has a series of seven large LNG newbuilds under construction at Daewoo. Provided final agreement is concluded with Sonatrach, all seven vessels are employed for at least 20 years from delivery. The first vessel is due to be delivered in the first quarter of 2003.

Bergesen's VLCC fleet generated first-quarter operating profit of $ 11.9 million, compared with $49.7 million last year. Average T/C income was $17,200/day, compared with $44,200/day last year. Charter cover for Bergesen's VLCC fleet for the rest of 2002 stood at 37 percent at the end of the period. The VLCC market continued to deteriorate, slumping to a historic low. The average spot rate was around $16,600/day for modern vessels and $4,700/day for older turbine tonnage.

The rate differences between old and new tonnage are primarily caused by variations in fuel consumption. The high fuel cost have further widened the gap.

Bergesen's dry bulk fleet generated first-quarter operating profit of $2.9 million, the same as last year. Average T/C income was $20,300/day, compared with $22,000/day last year. Charter cover for 2002 is over 90 percent.

The market for large dry bulkers picked up during the first quarter thanks to high imports of iron ore into China and Japan and growth in shipments of coal from Australia and South Africa.

Rising industrial output means that the world's steel industry seems to be moving in the right direction after a difficult year in 2001. However, the introduction of customs tariffs on steel imports into the USA has increased uncertainty.

The company is buoyed by the fact that economic indicators suggest a gradual recovery in the U.S. economy.