Annual Report
2013
158th year of operation
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annual report 2013
TA B LE OF C ONT ENT S Side
Corporate structure . ..................................................................................................... . . . . 12 Milestones in DSD’s history . ....................................................................................... . . . . 13 Key figures – last five years ........................................................................................ . . . . 14 Areas of activity .. ......................................................................................................... . . . . 15 Annual report by the board of directors . ................................................................. . . . . 18 Income statement . ........................................................................................................ . . . . 14 Assets .................... ......................................................................................................... . . . . 15 Equity and liabilities . ................................................................................................... . . . . 16 Cash flow statement . ................................................................................................... . . . . 17 Naming ceremony . ...................................................................................................... . . . . 18 Fleet lists ........................................................................................................................ . . . . 20 Addresses . . .................................................................................................................... . . . . 24
C OR POR ATE ST RUCT URE
DSD Shipping
Det stavangerske dampskibsselskab as
MILESTONES IN DSD’s HISTORY
2014 Norled adds two 100% LNG-powered car ferries to the Tau connection. 2013 Norled builds the world’s first CO2 emission-free battery-operated car ferry for the Lavik – Oppedal route in Sogn og Fjordane. 2012 Norled begins operating the Bergen – Sogn og Fjordane express boat route (1 May). 2011 Nor Lines contracts two environmentally-friendly LNG-powered freighters from China. 2011 DSD takes over 100% of the shares in Tide Sjø AS, and the company is renamed Norled AS (from 1 January 2012). 2011 Nor Lines becomes a wholly-owned subsidiary of DSD. 2009 The world’s three first LNG-powered passenger ferries are deployed to the massive Nesoddtangen – Aker Brygge commuter route. 2007 Stavangerske AS is merged with Tide Sjø. 2007 Stavangerske AS builds three new carbon fibre express boats for the routes in Ryfylke, cutting fuel consumption by 40% and subsequently winning an award for universal design. 2006 Nor Lines establishes a nationwide ground transport system. 2004 Nor-Cargo is sold to Posten Norge AS. Nor-Cargo Shipping becomes Nor Lines AS. 2003 MF “Stavanger” – the first Norwegian aluminium catamaran car ferry is deployed to the Tau route. 2001 North Sea traffic is transferred to the new company Sea-Cargo, with a current ownership of Nor Lines 40% and Sea-Trans 60%. 2000 Allianse Informasjonssystemer ASA is bought and, over the course of the next five years, further developed into Rogaland’s largest IT company with branch offices throughout Southern Norway. 1999 DSD buys 42.4% of the shares in HSD. 1997 RT builds the first Norwegian ferries in Poland. 1992 Boknafjorden Ferjeselskap (50% BNR and 50% RT) wins the commuter ferry licence across the Boknafjord between Mortavika and Arsvågen. 1989 DSD enters international shipping through DSD Shipping AS. 1989 DSD reorganises and establishes subsidiaries Rogaland Trafikkselskap (RT) and Nor-Cargo Stavangerske. 1988 DSD becomes part of RoNoTro, which bought Bergenske. 1986 The Westamaran “Fjordsol”, added to the Sand-Sauda route, receives an award for its universal design. 1978 Joint sailing Stavangerske – Mørerutene. Nord-Pool is established as a merger of several coastal shipping companies. 1971 DSD starts a Westamaran route in Puerto Rico. 1964 More efficient freight ship operation through the delivery of two ships equipped with side doors, cranes and heavy lifting beams: “Rogaland” and “Akershus”. 1960 Norway’s first hydrofoil boat “Vingtor” is deployed to Norway’s first express boat route between Stavanger – Haugesund – Bergen. 1959 The dawn of a new age - DSD receives a licence for the Stavanger – Tau route, signs a contract with the Norwegian Public Roads Administration and builds the first car ferry “Tau”, delivered in 1961. 1948 The birth of the motto “The white fleet”. The local ferries are painted white with yellow smokestacks.
1947 MS “Haugesund”, formerly “Kilbirnie”, is deployed to the Haugesund day service, which becomes the main connection across the Boknafjord. 1939 MS “Fjorddrott” is delivered as a result of experience with sea buses. The boat attracts considerable attention with its 140-foot length, lounges for 405 passengers, and room for 12–14 cars. “Fjorddrott” is deployed to the Haugesund and Sand – Sauda route in correspondence with the railway and bus link to Oslo. 1938 DSD takes good note of road network development, takes over the Sand – Ropeid ferry route and in the autumn of 1945, it procures a modern drive-through car ferry – “Ropeid”. 1938 The “Ekspress II” sister ship is deployed, inspiring the term “sea bus”. 1937 Technical Manager Ludvig Thorsen revolutionises the local liner design in Norway by building a light ship with a long, narrow hull powered by a diesel engine. This results in a ship with good sailing speed and solid operating economy. “Ekspress” is launched from the company’s own workshop in Klasaskjæret, and is added to the Sandeid route. 1934 DSD contributes share capital to Det Norske Luftfartsselskap (DNL), and becomes a shipping agent for the seaplane routes with a dedicated floating dock at Klasaskjæret. 1930 DSD starts joint-sailing with Bergenske in Danzig and Gdynia, with sporadic calls at Königsberg. 1924 DSD begins collaborating with Bergen LIoyd and deploys “Tungenes” between Trondheim, the cities in Western Norway and Stettin-Lübeck. 1922 The shipping line starts an international route to Leith and Grangemouth with the cargo ship “Jæderen”. 1919 DSD takes an ownership stake in Hurtigruten and gives Stavanger a weekly link to the route between Bergen and Kirkenes. From 1919 to 1940, DSD is the only company to run a regular post, freight and passenger service along the entire Norwegian coast. 1912 The Sandnes/Stavanger – Kristiania coastal steamer is expanded with “Austri” and “Vestri”, purchased from Denmark and equipped with refrigeration units to ensure fast and hygienic transport of meat to the capital. 1909 The Bergen railway opens, and DSD expands the night route with the newly built “Bergen”. 1904 “Kong Olaf” is deployed to a new weekly express route between Sandnes/Stavanger and Kristiania – to secure rapid transport of agricultural products from Jæren. 1897 DSD enters into a joint-venture with Sandæs Dampskibs-Aktieselskab to operate the night route between Sandnes, Stavanger and Bergen. It is agreed that HSD would be responsible for the correspondence with the local ferries in Sunnhordland. 1885 DSD enters the travel/tourism segment, providing significant funding to “Suldal” on the Suldalsvannet lake to promote tourism between Sand and Røldal. 1879 DSD looks to the international market, winning the tender for a 3-year contract to operate the summer mail route between Kristiansand and Fredrikshavn in Jutland, Denmark. “Stavanger” and later on, “Kong Olaf”, are deployed to the route. 1868 DSD receives its first modern screw steamer “Stavanger”, which is deployed to the route between Kristiania and Bergen starting in the spring of 1868. The coastal route becomes one of the country’s most important trunk routes. 1855 DSD is established on 12 February 1855 to build and operate the “Ryfylke” paddle steamer on the first commercial boat routes in Ryfylke.
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annual report 2013
KEY FIGURES LAST FIVE YEARS Figures in MNOK Operating revenues EBITDA Operating result Profit/loss before tax
2009
2010
2011
2012
3 775 724 308 329
3 932 772 319 209
4 965 635 -75 -274
4 884 531 -176 -280
2 856 274 59 -99
Fixed assets Current assets
5 596 1 239
5 954 1 224
6 183 1 145
4 593 564
4 549 805
Equity capital Interest-bearing debt Net interest-bearing debt Cash Market-based securities
2 167 3 618 2 947 671 205
2 303 3 742 3 066 676 114
1 911 4 203 3 719 484 0
1 553 2 871 2 683 188 0
1 675 2 939 2 469 470 0
Total balance Equity-to-assets ratio
6 836 31,7 %
7 179 32,1 %
7 328 26,1 %
5 158 30,1 %
5 354 31,3 %
Total return on capital Return on equity
8,4 % 17,5 %
5,8 % 9,4 %
-0,7 % -13,0 %
-0,9 % -16,2 %
2,6 % -6,1 %
876 176 %
790 148 %
484 119 %
188 59 %
470 84 %
Liquid assets Liquidity ratio * Tide ASA is not consolidated in the 2013 figures.
2013*
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Det stavangerske dampskibsselskab as
AREAS OF ACTIVITY FERRIES AND EXPRESS BOATS
Most of Norway’s ferry and express boat routes are now subject to competitive tender processes. Profitable operations will therefore be Norled’s primary focus, with special emphasis on refining the existing contract portfolio, participating in new tenders, and consolidating positions where contracts held by the company come up for new bids.
Photo: Samferdselsfoto.
Norled AS, the ferry and express boat company employs about 1000 people and has 73 vessels. The company operates 49 ferry and express boat routes in Troms, Nord-Trøndelag, Sør-Trøndelag, Møre og Romsdal, Sogn og Fjordane, Hordaland, Rogaland, Vest-Agder, and the Oslo fjord. Norled is devoted to environmentallyfriendly car and passenger transport, and operates three gas-powered ferries in the Oslo fjord. Starting from late 2013/early 2014, the company will have two new gaspowered car ferries (accommodating 165 cars) that will serve the Stavanger – Tau route. In 2015, Norled will start an environmental tender operation of the Lavik – Oppedal route on E39 in Sogn og Fjordane. y. Norled is currently building a battery-operated ferry that runs exclusively on electric power, recharging every time it docks to allow cars and passengers to disembark and embark. This will be the world’s first 100% emission-free ferry. The ferry is currently being outfitted and commissioned at Fjellstrand AS at Oma.
annual report 2013
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AREAS OF ACTIVITY BUS TRANSPORT
Tide ASA, with its main office in Bergen, is one of the largest bus companies in Norway and Denmark. Tide is listed on the Oslo Stock Exchange, and DSD is the largest owner with 49% of the shares. DSD’s parent company holds a further 28%, and the Group thus controls 77% of the shares. The company’s core activity is bus transport contracted by the public sector. In Norway, Tide operates routes in Hordaland, Rogaland and Sør-Trøndelag, as well as in Nordmøre starting 4 January 2014. Tide will start running regular bus routes in Vestfold country from 1 July 2014. The Danish activity consists of the FynBus routes on Funen and the Sydtrafikk routes in South Jutland. Tide also has extensive express and airport express bus operations, and considerable involvement in charter travel and tour activities. Tide’s primary task is to ensure safe transport of passengers to their destination at all times – every minute, every day – year-round. The enterprise is certified according to the ISO 9001 quality standard and the ISO 14001 environmental standard. From the spring of 2014, Tide also became certified according to the OHSAS 18001 working environment standard. Public transport is an important sector in our modern
society. Rising population in the major cities and greater demands for environmentally-friendly transportation will only add to the importance and growth of this industry. Tide intends to consolidate and further develop its position as an important player in this landscape. The company has secured contracts worth more than NOK 10.7 billion, including options. Tide currently employs over 2,800 people, and operates a fleet of approx. 1,450 buses.
Det stavangerske dampskibsselskab as
AREAS OF ACTIVITY LOGISTICS SYSTEM AND FREIGHT
With a staff of more than 350, Nor Lines operates an extensive logistics system with freight liner service along the Norwegian coast, in the North Sea and the Baltic Sea. The company also operates central warehouse terminals with 3PL and Crossdocking, and also handles associated distribution activities from its terminals. An extensive ground transport system, along with forwarding, customs clearing and overseas transport operations, are supported by the company’s 13 terminals in Norway. Nor Lines is represented by partners in 30 Norwegian ports and 10 Northern European ports, in addition to a network of distribution and forwarding partners. All freight capacity on the Hurtigruten boats is also managed by Nor Lines. At year-end, Nor Lines’ liner operation consisted of 10 freighters; seven of which are wholly-owned and managed by the Group. The company also functions as a commercial broker for 2–3 freezer ships in the North Sea and Baltic Sea. The company’s fleet is due for renewal. Two LNGpowered freighters were contracted in the autumn of 2011 from Tsuji Heavy Industries in China, and will be added to the company’s routes in early 2015. Nor Lines is the market leader in sea transport of general cargo in Norway, and has a significant market share of
regular routes to/from Norway in the North Sea and Baltic Sea. Over the past few years, Nor Lines has built a comprehensive transport system on land, including the railway as an important component on many routes. The goal is to offer competitive and environmentally-sound transport solutions. Nor Lines owns 39% of Sea-Cargo, which operates five general cargo and ro-ro vessels on regular routes between Western Norway and England, Scotland, the Netherlands and Denmark, along with three ships on industrial contracts, and one ship on a contract route primarily serving windmill projects.
INTERNATIONAL SHIPPING
DSD Shipping DSD Shipping AS is a fully-integrated shipping organisation, established in 1989 and with offices in Stavanger and Singapore. The company has an office staff of 23, and crew members from Europe and Asia. DSD Shipping is responsible for technical and commercial operation of the Group’s international tankers. DSD Shipping is certified in accordance with the ISM code, the ISO 9001:2008 standard and meets the major international oil companies’ strict requirements for highquality operation. At the end of the year, DSD Shipping was responsible for operation of nine crude oil and product tankers where DSD is the owner or has an ownership stake. The fleet currently consists of four Aframax crude oil tankers and five product tankers of different sizes: one LR2, two MRs, and two 16,500-dwt intermediate ships.
The fleet is modern, with an average age of seven years. The ships are contracted to solid charterers such as AET, Vitol, Vela and Statoil – while the others operate in the RSA and Taurus pools.
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annual report 2013
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2013 annual REPORT BY THE BOARD OF DIRECTORS
THE NATURE OF THE BUSINESS AND ITS MAIN OFFICE
The DSD Group, with its parent company Det Stavangerske Dampskibsselskab AS (DSD), is a company domiciled in Norway, with its main office in Stavanger. Transport operations have been the company’s primary activity since its est ablishment in 1855. Today the enterprise is concentrated on four business areas: International Shipping (DSD Shipping AS), Freight (Nor Lines AS), Ferry and Express Boat Operation (Norled AS), and Bus Transport (Tide ASA). The maritime enterprise is mainly wholly-owned by DSD, while the bus enterprise is a listed company with DSD as the largest owner (49%). DSD’s parent company Folke Hermansen AS owns another 28% and the Group thus controls 76% of Tide ASA.
DEVELOPMENT AND DIRECTION 2013
The DSD Group had a turnover of NOK 2,846 million in 2013 (compared with NOK 4,884 million in 2012). The turnover is divided among the Group’s three business areas, with ferry and express boat operations (Norled AS) accounting for 58%, freight (Nor Lines AS) 33%, and
international shipping 9%. Bus transport (TIDE ASA) is not consolidated in the 2013 accounts, but had a turnover for the year of NOK 1,994 million. 2013 was largely affected by the development in international shipping, where we saw the tank market bottom out in terms of both rates and ship values during the course of the year. This has led to a reversal of previous years’ writedowns of the value of the Group’s international shipping fleet of net NOK 44 million, compared with an overall writedown of NOK 559 million for the two previous years. Nevertheless, the weak tank market was a drag on the Group both in terms of profits and liquidity, which led to the Group deciding to reduce its exposure somewhat, while also boosting the company’s liquidity through an equity issue. Important events in 2013 which have had an impact on the Group’s financial position: • Sale of two 100%-owned and one 50%-owned tankers • NOK 200 million capital inflow from parent company • Delivery of two new gas-powered ferries • Partial reversal of write-down on our tankers as a consequence of increased fleet value
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Det stavangerske dampskibsselskab as
Ferry and express boat operation: NORLED AS Norled is one of Norway’s largest companies in sea transport of passengers and vehicles. The company operates 73 vessels in a number of ferry and express boat routes along Norway’s coast from the Oslo fjord to Nord-Troms. In 2013, the company transported 7.5 million passenger car units and 15 million passengers under various contracts with the state and county municipalities. These contracts make up a contract backlog worth NOK 15 billion. Norled’s headquarters are in Stavanger, with regional offices in Bergen, Ålesund and Oslo. The company employs around 1,000 people. The Group also has 51 apprentices in the fleet, equivalent to about 5.6% of all maritime employees. Norled’s profit before taxes was NOK 12 million in 2013, compared with NOK 18 million in 2012. If we adjust for one-time effects related to gains and write-downs, the company achieved improved profits and an improved EBITDA. The company’s results are still affected by some older weak tender contracts that are gradually being phased out. 2013 was an active year where Norled participated in many tenders and secured greater market shares by winning several of these. The company won five contracts with a total value of NOK 2 billion. New building activities has been vigorous throughout the year as a result of higher activity. The order book showed seven vessels at year-end, of which four have now been delivered. In 2014, the company has contracted two additional vessels, which means
that the building program now constitutes five vessels, all of which will be deployed to contracts with various county municipalities as the principals.
Photo: Samferdselsfoto.
BUSINESS AREAS
Freight: NOR LINES AS Nor Lines is a transport and logistics company that ope rates coastal routes along the entire coast, in the North Sea and the Baltic Sea. The company has an extensive land transport system, forwarding activities, as well as terminal operation with associated distribution activities. The company has 14 branch offices along the coast and, at yearend, operated a fleet of nine pallet, refrigerator and side port ships in its regular routes, as well as two refrigerator ships in the spot market. Nor Lines also leases and operates all of the freight capacity on the Hurtigruten’s 11 ships.
annual report 2013
Nor Lines has 208 employees along the coast from Fredrikstad to Hammerfest and 200 seamen employed on board the company’s ships. Nor Lines owns 39% in Sea-Cargo, a shipping line headquartered in Bergen which operates nine ships, primarily engaged in the North Sea Basin. Nor Lines had a pre-tax loss of NOK 4 million, compared with a pre-tax profit of NOK 18 million in 2012. The share of the profit from the ownership in Sea-Cargo was NOK 31 million, compared with NOK 20 million in 2012. This means a considerably weaker result for the company, if we adjust for this fact. In 2013, this weak result is mainly linked to challenges associated with the aging fleet. Shutdowns due to technical challenges with our ships create delays, but also cause expenses for the company related to alternative delivery of goods. We are looking forward to delivery of the company’s new ships in the second half of 2014. This will entail a substantial improvement in the Nor Lines product, while the new LNG-powered ships represent a renewal of the coastal fleet which, in turn, will yield more efficient and environmentally-friendly transport. International shipping: DSD SHIPPING AS
DSD Shipping is a fully integrated shipping company organisation with 23 employees who run DSD’s internatio nal shipping fleet from the headquarters in Stavanger and branch office in Singapore. At the beginning of the year, the fleet comprised seven crude oil tankers and five product tankers of various sizes. During the year, the Group opted to reduce its exposure in the volatile tanker market by selling two wholly-owned and one 50%-owned aframax tankers. The shipping segment suffered a pre-tax loss of NOK 13 million in 2013, compared with a loss of NOK 187 million in 2012. A reversal of previous write-downs underlies this improved result. If we adjust for reversals/write-downs, gain/loss and agio effects, the 2013 result is a loss of NOK 29 million, compared with NOK 0 million in 2012. The reason for the weaker result was more ships exposed to a weaker tanker market in 2013, compared with 2012 when all of our ships operated under lucrative contracts during the first half of the year. There was a rise in both earnings and ship values in the segment toward the end of the year, which has continued into 2014.
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BUS: TIDE ASA
Tide AS is not consolidated in the accounts, but is recorded as an affiliated company according to the equity method. Tide ASA, headquartered in Bergen, is one of Norway’s and Denmark’s largest bus companies. Tide is listed on the Oslo Stock Exchange. DSD owns 49% of the shares and DSD’s parent company, Folke Hermansen AS, owns another 28% of the shares. The Group thus controls 77% of the shares. The company’s core activity is bus transport with the public sector as principal. In Norway, Tide ope rates bus lines in Hordaland, Rogaland and Sør-Trønde lang counties. The company also opened routes in Møre og Romsdal county in January 2014, and won a tender in Vestfold with start-up in July 2014. The Danish activity is on Fyn and in Syd-Jylland. Tide also has extensive express and airport bus operations, as well as considerable involvement in charter travel and tour activities. Tide employs more than 2,700 people and operates a fleet of 1,450 buses. Tide ASA had a pre-tax loss of NOK 61 million in 2013, compared with a loss of NOK 63 million in 2012. Write-downs related to tender contracts were carried out in 2013. There were no comparable write-downs in the previous year. Furthermore, the company achieved greater gains on the sale of property and operating assets in 2013 as compared with 2012. Adjusted for these effects, the company’s profit improved by NOK 14 million from 2012 to 2013. During the year, Tide won new contracts in both Denmark and Norway, bringing its order reserve, including option years, to NOK 11.1 billion, an increase from NOK 10.4 billion in the previous year. The Danish bus company Haderslev was purchased in the 2nd quarter, which increased the company’s presence in Denmark to a total of around 450 buses and 900 employees.
CONTINUED OPERATION
In accordance with Section 3-3a of the Accounting Act, the going concern assumption is present.
Det stavangerske dampskibsselskab as
REVIEW OF THE FINANCIAL STATEMENTS Income statement 2013 marked the DSD Group’s 158th year of operation. Turnover for the Group was NOK 2,856 million compared with NOK 4,884 million in 2012. TIDE ASA was part of the DSD Group in 2012, turnover for TIDE ASA amounted to NOK 1,922 million. Adjusted for TIDE ASA, the Group’s turnover is reduced by 106 million, which reflects reduced earnings in international shipping, as well as a marginal reduction of the top line in Norled and Nor Lines. EBITDA amounted to NOK 274 million, a weakening from NOK 531 million in 2012. The 2012 figures include TIDE ASA with NOK 148 million. Adjusted for TIDE ASA, the EBITDA drop of NOK 109 million is mainly due to weaker earnings in shipping (NOK 51 million), lower gain effects (NOK 28 million), as well as a weaker contribution from Nor Lines of NOK 36 million. Net write-downs and reversals amounted to NOK -35 million, compared with write-downs of NOK 265 million in 2012. This yields an operating result of NOK 59 million, compared with an operating loss of NOK 176 million in 2012. The result after taxes was a loss of NOK 87 million, compared with a loss of NOK 236 million in 2012. CASH FLOW, LIQUIDITY AND DEBT The company had positive cash flow for the year, NOK 283 million, compared with a negative cash flow in 2012 of NOK 297 million. Cash flow from operations was NOK 275 million compared with NOK 566 million in 2012. The 2012 figures include TIDE with NOK 230 million. Cash flow from investment activity was negative with NOK 173 million. Payments related to the Group’s ships building program are NOK 545 million, largely related to Norled’s new-build program. Cash flow from the sale of tangible fixed assets amounted to NOK 306 million, largely related to the sale of tankers. Interest-bearing debt showed marginal growth of NOK 16 million. International shipping debt was reduced by NOK 441 million, while debt in Norled grew by NOK 455 million. EQUITY Total capital was NOK 5,354 million at year-end, compared with NOK 5,158 million the previous year. Equity at 31 December was NOK 1,675, which represents an equity-to-assets ratio of 31%, compared with 30% for the previous year. DSD conducted an equity issue in June 2013, which brought the company NOK 200 million in new equity capacity from the parent company, Folke Hermansen AS.
FINANCIAL RISK Goals and strategy The Group is exposed to financial risk relating to the business areas. This is mainly linked to currency, interest rates and oil prices, as well as credit risk. The goal is to mode rate the financial risk as much as possible. Risk is contin uously monitored, and financial derivatives are used to reduce such exposure. Market risk The Group is exposed to fluctuations in exchange rates, especially USD, as part of the company’s revenues are in foreign currency. The Group seeks to neutralise currency risk in that activities with earnings and associated debt servicing in a foreign currency also borrow in the same currency. A large share of the interest rate exposure is hedged through compensation clauses in public transport contracts. The Group also uses derivatives from time to time to reduce interest rate risk in the various business areas. The Group is exposed to the developments in oil prices and bunker consumption. The high price of oil has been a significant burden on the Group’s results during the past few years. Contract regulation has improved significantly in recent years in ferry and express boat operation, and the risk will therefore decline. The credit risk is considered to be moderate. The counterparty risk for International Shipping has increased after several years of poor earnings. For Ferries and Express Boats, the counterparty is the State and county administrations, with a low counterparty risk.
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annual report 2013
The Group’s liquidity risk is considered acceptable. The soft market in international shipping has weakened the Group’s financial position. As a consequence of this, a NOK 200 million increase in capital was carried out in 2013, and the Group’s exposure in the volatile tanker market was reduced by three ships. Our international shipping activity was refinanced toward the end of 2013, and the segment now has sufficient earnings to service both operating costs and debt. The Group’s new building program is fully-financed, with the exception of two vessels in Norled that are contracted in the first quarter of 2014. The Group’s loan agreements include financial requirements. The Group met these marks throughout the year, and forecasts indicate that it will continue to do so in 2014, even though the margin is relatively small in relation to a specific requirement. The stable cash flow from the ferry and express boat operation offers a predictability that leads the board to consider the Group’s liquidity risk to be acceptable.
WORKING ENVIRONMENT AND EMPLOYEES
GENDER EQUALITY
The Group’s goal is to be a workplace with full equality between women and men. The Group has drawn up guidelines to ensure that there is no gender-based discrimination in matters such as pay, promotion and recruiting. Transportation and maritime activities are traditionally male-dominated industries. The Group employs 239 women; i.e. 17.8% of its workforce. Female representation on the corporate management team was 33%, while it was 20 % on the board of the parent company.
DISCRIMINATION
The various subsidiaries have established procedures for whistleblowing regarding censurable practices or conditions, for conflict resolution and for reporting bullying and harassment. The guidelines have been adopted in the working environment committees in the respective companies and have been announced in the organisation. The guidelines are also available in the companies’ employee handbooks. All Group employees have equal wages and working conditions, regardless of gender, nationality and ethnicity.
ENVIRONMENTAL REPORTS
At year-end, the DSD Group had 1,279 employees. The DSD Group wants to be an attractive workplace with a good working environment. It therefore places great emp hasis on health, safety and the environment. There is good collaboration between employees, the employee representatives and management. In 2013, the Group continued the work of reducing sick leave, with particular focus on long-term sick leave. Group sick leave amounted to 5.2% in 2013, while the comparable figure for 2012 was 5.1% (excluding TIDE ASA). TIDE has focused on work to reduce sick leave over quite some time. The activity in Norway has a sick leave of 8.7% in 2013. This is still too high, but represents a reduction from 9.6% in 2012 and 11% in 2011. Correspondingly, TIDE Bus Danmark AS had a sick leave of 4.6%, which is the same level as in 2012.
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The nature of the Group’s activities entails an impact on the external environment. The company emphasises early implementation of requirements stipulated by the authorities to reduce pollution. Installation of environmentally-friendly technology is emphasised in new builds to reduce emissions to the extent possible. The Group works actively to reduce the use of diesel within ferry and express boat operation, bus transport and freight, and an increasing percentage of the Group’s vessels now use natural gas. There was comprehensive innovation work in all of the business areas over the past year, with focus on energy efficiency and the environment. Gradual reductions were achieved in fuel consumption through improvements that focus on attitude-building work and good route planning. The Group is an active partner in developing new vessel concepts, energy-efficient engines and propellers, and use of alternative fuels like biofuel, natural gas and electric power. The DSD Group wants to lead developments, and is a driver and innovator in environmentally-friendly transport. Norled currently operates five LNG-powered passenger ferries. Two of these were delivered in 2013 and are the world’s first ferries which exclusively use LNG as energy source. These ferries reduce NOX emissions by 80% and CO2 emissions by 20%. In 2012, the company contracted the world’s first battery-operated car ferry. Norled won the 2013 Research and Innovation Prize awarded by Rogaland Research Council, NHO Rogaland and Rogaland County Authority. Norled was also nominated as one of four finalists for the prestigious 2014 Thor Heyerdahl award by the Norwegian Shipowners’ Association. Nor Lines has two gas-
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Det stavangerske dampskibsselskab as
powered freighters under construction which will represent a renewal of the coastal fleet and will yield environmental benefits by replacing older tonnage. The new-builds will incorporate the Environship concept developed by Rolls Royce Marine, which won the Thor Heyerdahl prize in 2014. TIDE has more gas buses than any other company in Norway. In 2013, the company started the first tender in Denmark with gas-powered buses. The Group’s ships have international and domestic certification pursuant to the International Management Code for Safe Operation of Ships and Pollution Prevention (the ISM code). Passenger ships and ferries larger than 400 grt. have valid IAPP certificates and IOPP certificates in accordance with requirements laid down by the Norwegian Maritime Authority. Within international shipping, both ships and company have NS ISO9001:2008 certification. All of TIDE’s branches are certified in accordance with the environmental standard NS ISO 14001.
elected as a new Board member. In March 2014, Steinar Madsen resigned as CEO and Yuhong Jin Hermansen took up the post of working board chair.
OWNERSHIP, ETC.
The board proposes the following allocation to cover the loss in Det Stavangerske Dampskibsselskab AS:
The company’s objective is profitable operations to ensure satisfactory, long-term return on invested capital. The Group has not succeeded to achieve satisfactory profitability in any of its segments in recent years. Several of the Group’s subsidiaries have strong technical and market positions in their segments. Stronger focus on cost control and risk management in the time ahead will improve Group profitability. Development of expertise will ensure that the Group achieves long-term profitable development. Overall, the board expects satisfactory profits and positive results in 2014.
RESULT FOR THE YEAR AND ALLOCATIONS
Reserve for valuation variances Other equity Total allocation
54 333 31 962 86 295
Photo: Tommy Ellingsen.
DSD is a wholly-owned subsidiary of Folke Hermansen AS. Yuhong Jin Hermansen took over as chairman of the Board in August 2013, after Erik Eik chose to resign upon reaching the age of 70. Hermansen has been a member of DSD’s board since 2005. Furthermore, Bjørn Anders Dahle was
FUTURE DEVELOPMENTS
Stavanger, 6 May 2014 The Board of Det Stavangerske Dampskibsselskab AS:
Yuhong Jin Hermansen Chairman of the Board / Managing Director
Steinar Olsen Deputy chairman
Jon Bøthun Board member
Ole Melberg Board member
Bjørn Anders Dahle Board member
annual report 2013
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INCOME STATEMENT Parent
01.01–31.12
2013 2012 (Amounts in NOK 1.000)
10 053
11 562
6 006
6 591
-15 748
-17 503
333
320
Note 2013 2012
311 650 Operating revenues 16,18 2 855 524
Group
0
-16 081
Salery cost
3,11
1 008 271
2 102 660
Other operating costs
3,21
1 573 234
2 251 034
EBITDA 274 019 530 668 Depreciation on tangible fixed assets
0 Write-Downs
-17 823
12
250 076
441 314
12
-35 000
265 000
Operating profit/loss 58 943 -175 646
-40 234 -194 069
Profit from investments in subsidiaries
2
-16 511
-13 225
Profit/loss associated companies
2
0
0
Profit from short-term investments
8
-56 745 -207 294 2 190
8 267
-20 345
-30 022
0
0
-18 155
-21 755
-90 981 -246 872
4 686
12 123
-86 295 -234 749
0
0
-86 295 -234 749
4 884 362
0 0 -10 441
-19 670
0 0
Profit from investments -10 441
-19 670
Financial income
9
103 956
68 208
Financial expenses
9
-237 473
-224 527
Unrealised agio/disagio
9
-13 803
71 337
Net financial items -147 320 -84 982 Ordinary profit before tax -98 818
-280 298
12 353
31 879
-86 465
-248 419
597
-12 036
Profit after minority interest -87 062
-236 383
Tax on ordinary profit
14
Annual profit before minority interests Minority interests
15
Allocation on the result -54 333 -319 110
Valuation difference fund
-31 962
Other equity
84 361
-86 295 -234 749
Total allocated
15
Det stavangerske dampskibsselskab as
ASSETS Parent
01.01–31.12
2013 2012 (Amounts in NOK 1.000)
Group Note 2013 2012
Assets
Intangible assets
0
0
8 922
8 922
4 000
Other intangible assets
12
6 629
Deferred tax asset
14
6 629
Total intangible assets 4 000
4 000
0 0 4 000
Tangible fixed assets
4 634
4 908
182 123
Land and buildings
12
5 997
Means of transport and other operating equipment
12
10 795
6 121 8 539
0
0 Ships
12 3 185 359
3 623 758
0
0
Periodic maintenance
12
31 630
40 259
0
0
New building contract ships
12
978 229
509 873
4 816
5 031
Total tangible fixed assets 4 212 010
4 188 550
Long-term investments 1 813 738
1 703 498
210 978
220 579
2 805
6 732
156
151
Investments in subsidiaries
2
Investments in associated companies
2
Loans to Group companies Other receivables
4,7
0 0 312 740
378 981
0 0
4,7,11
12 770
8
7 761
13 587
5 682 5 932
Investments in shares and ownership interests
2 033 361
1 936 892
Total long-term investments 333 271
400 528
2 047 099
1 948 552
Totale non-current assets 4 549 282
4 593 079
7 960
Current assets
0 0 Inventories 13 15 364 45 884
Receivables
6
0
33 728
79 335
380
540
34 114
79 875
182 292
216 574
7
0
3 000
Other receivables
136 831
111 653
Trade receivables Receivables on Group companies
Total receivables 319 123 331 227
Investments
43
43 43 Total investments 43 43
43
110 249
21 479
144 406
101 397
2 191 505
2 049 949
Marketable Securities Cash and cash equivalents
8 5,6
43 43 470 026
Total current assets 804 556
187 501 564 655
TOTAL ASSETS 5 353 838 5 157 734
annual report 2013
16
EQUITY AND LIABILITIES Parent
01.01–31.12
Group
2013 2012 (Amounts in NOK 1.000)
Note 2013 2012
Equity Called-up and fully paid equity
573 736
445 288
Share capital
15
573 736
445 288
305 406
233 854
Share premium reserve
15
305 406
233 854
879 142
679 142
Total called-up and fully paid equity
879 142
679 142
Retained earning
335 166
389 499
Valuation difference fund
443 504
467 130
Other equity
Group funds
793 125
872 068
Minority interests
2 702
2 112
Total retained earnings 15 795 827
874 180
778 670
856 629
1 657 812
1 535 771
Total equity 1 674 969 1 553 322
debt Provision for liabilities
7 130
6 223
0
0
7 130
6 223
Pension liabilities
11
51 214
46 470
Deferred tax
14
103 526
118 795
Total provisions 154 740 165 265
Other long-term liabilities
187 000
215 000
Liabilities to financial institutions
169 164
162 968
Liabilities to group companies
7
0
0
Other long-term debt
6
356 164
377 968
6, 10
2 887 889
2 871 240
0 0 441
1 166
Total other long-term debt 2 888 330
2 872 406
Short-term debt
0
0
782
451
0
0
525
358
163 871
125 287
5 221
3 891
170 399
129 987
Total short-term debt 635 799
533 693
514 178
Total debt 3 678 869 3 604 412
2 191 505
2 049 949
Liabilities to financial institutions
51 389 0
5,6
188 859
220 807
14
2 916
11 664
Indirect taxed payable
63 800
69 508
Debt to group companies
7
80 000
17 955
Other short-term debt
248 835
246 807
Account payable Taxes payable
Total equity and liabilities 5 353 838
566 741 5 157 734
Stavanger, 6 May 2014
Yuhong Jin Hermansen Chairman of the Board / Managing Director
Steinar Olsen Deputy chairman
Jon Bøthun Board member
Ole Melberg Board member
Bjørn Anders Dahle Board member
Det stavangerske dampskibsselskab as
17
CASH FLOW STATEMENT
Parent 01.01–31.12 Group 2013 2012 (Amounts in NOK 1.000) Note 2013 2012 Cash flow from operating activities Profit before tax -98 818 -280 298 -90 981 -246 872 Depreciation and amortisation 12 238 603 429 303 333 320 Depreciation of main/intermediate class 12 11 473 12 013 0 0 Write-downs tangible assets 12 -35 000 265 000 0 0 Loss/(gain)from sale of fixed assets 12,21 -1 127 -16 626 0 0 Profit from investments in subsidaries 0 0 40 234 194 069 Profit/loss from investments in associated companies 2 10 441 19 670 16 511 13 225 Net financial items 147 320 84 982 18 155 21 755 Changes in inventory 13 30 520 -18 495 0 0 Changes in accounts receivable 34 282 5 091 3 190 0 Changes in accounts payable -31 948 -116 331 302 Changes in pension liabilities 11 4 354 -10 697 907 1 971 Taxes 14 -11 664 -16 888 0 0 Changes in other accrual items -23 344 92 567 1 187 341 Net cash flow from operations 275 092 565 506 -10 133 -14 889 Cash flow from investments 0 0 Payments received from sale of tangible fixed assets 12 305 601 174 950 Payment received from financial assets 0 0 0 0 Disbursements from puchase of tangiable fixed assets 12 -544 637 -447 032 -118 -36 Net cash effect consolidation 2 0 51 219 0 0 Payments received from sale of shares -50 0 0 0 Increase equity subsidaries 0 0 -150 000 -79 973 Payments received from sale of shares 11 554 20 958 0 130 646 Dividend received 54 400 15 399 0 17 250 Received group contribution 0 0 76 139 2 745 Called-up capital other investments 0 -1 510 0 0 Payments received from other investments 27 332 27 332 Net cash flow from investments -173 105 -185 684 -73 952 70 964 Cash flow from financing -20 114 -29 368 Interest paid 9 -140 067 -171 732 Interest received 9 9 180 10 678 2 150 2 046 Realised agio/disagio 9 3 842 -773 33 59 Payments received from new long-term borrowing 6,10 1 441 636 1 430 664 0 0 Payments from repayment of long-term debt 6,10 -1 446 762 -1 934 220 -28 000 -184 462 Payment other long term debt -725 -19 216 0 -17 955 Disbursements from lending to group companies 0 0 -994 -2 640 Payments received from long-term borrowing 6 196 6 735 from Group companies 0 0 Net change receivables Group companies 7 62 045 14 955 13 584 142 545 Disbursements from reduction of bank overdraft 51 389 0 0 0 Disbursements from repayment of short-term debt 200 000 0 200 000 0 Disbursement/payment received to/from minority 2,10 0 -1 521 0 0 Disbursement from dividend 0 -5 310 0 0 Net cash flow from financing 180 538 -676 475 172 855 -83 040 Net change in cash through the year 282 525 -296 653 88 770 -26 965 Cash 01.01. Cash and cash equivalents 187 501 484 154 21 479 48 444 Cash and cash equivalents 01.01.–31.12. 470 026 187 501 110 249 21 479 Tied-up assets (source tax deduction) 1 179 1 056 325 325 Cash consists of cash in hand and in the bank.
annual report 2013 The world’s two first 100% natural gas-powered car ferries
MF “Ryfylke” was christened at the quay outside the Stavanger Concert Hall on 18 December 2013. After the christening, Norled organised a concert featuring the local group ‘VAMP’ to raise money for the Folke Hermansen cancer research fund.
Tau Marching Band defied the weather and provided a musical backdrop for the ferry christening.
Ryfylke chef Frode Selvaag serves christening cake to Yuhong Hermansen and Tore Lærdal.
Proud sponsor of MF “Ryfylke”, Janne Johnsen, with Executive Captain Torleiv Landsnes and flower boy Mortenius Stølen.
named and deployed into the Stavanger-Tau ferry service
On 14 February 2014, MF “Hardanger” was christened at Fiskepirterminalen in Stavanger. Class 7A and the marching band from Hafrsfjord school were among the satisfied guests transported by Tide Reiser.
Storting representative and deputy chair of the Storting’s Standing Committee on Transport and Communications Eirin Sund and mayor of Strand Helge Steinsvåg at the cake party on board, together with Yuhong Hermansen and Ivan Fossan.
MF “Hardanger’s” proud sponsor Anne Grethe Are Madsen, Executive Captain Geir Kristoffersen and flower girl Mira Malde Pedersen.
Pupils from Class 7A and marching band musicians from Hafrsfjord school enjoyed the cake party.
annual report 2013
20
FLEET LIST AS OF 31 MARCH 2014 Built
Size
Tankers – DSD Shipping MT «Stavanger Prince» MT «Stavanger Blossom» MT «Stavanger Bliss» MT «Eagle Stavanger» MT «Eagle Sydney» MT «Stavanger Breeze» MT «Stavanger Eagle» MT «Stavfjord» (30 %) MT «Star Viking» (30 %)
2002 2007 2008 2009 2009 2004 2004 2009 2009
110.000 105.000 105.000 105.000 105.000 47.000 45.000 16.000 16.000
dwt. dwt. dwt. dwt. dwt. dwt. dwt. dwt. dwt.
Coastal liners – Nor Lines MS «Baltic Betina» (30 %) MS «Cometa» MS «Link Star» (TC) MS «Nordvåg» (50 %) MS «Nordjarl» MS «Nordvær» MS «Sunnmøre» MS «Tananger» MS «Nordkinn» (BB + call option)
1983 1981 1989 1979 1985 1986 1985 1979 2006
3229 4450 4453 2540 2400 2067 2067 4450 2500
dwt. dwt. dwt. dwt. dwt. dwt. dwt. dwt. dwt.
21
Det stavangerske dampskibsselskab as
FLEET LIST AS OF 31 MARCH 2014 Ferries – Norled
Built
Grt.-Cars-Passengers
MF Austevoll
1979
769-35-200
MF Bjørnefjord
1990
2 871-105-390
MF Bømlo
1972
1 206-73-260
MS Dronningen
2009
600
MS Dyrøy
1964
415-22-94
MF Etne
1979
MF Fedjefjord
2001
MF Finnøy
1999
MF Fitjar MF Fjordveien
Built Grt.-Cars-Passengers
MS Kongen
2009
600
MF Kvam
1977
839-35-147
MF Kvinnherad
1978
839-42-248
MF Lauvstad
2007
884-50-145
MF Melderskin
1985
1 974-112-400
1 660-94-390
MF Os
1978
838-35-147
2 232-42-130
MS Prinsen
2009
600
1 935-101-350
MF Ropeid
1969
551-33-141
1973
740-35-195
MF Ryfylke
2013
2 999-165-550
2001
3 368-79-300
MF Sand
2007
879-50-255
MF Foldøy
1999
1 656-48-200
MF Sjernarøy
1999
1 656-48-200
MF Folgefonn
1998
1 182-76-299
MF Stavanger
2003
2 434-114-393
MF Frafjord
1979
739-34-165
MF Stord
1987
2 871-107-390
MF Folkestad
2005
1 910-90-295
MF Strand
1982
1 479-64-422
MF Hardanger
2013
3 999-165-550
MF Strandebarm
1971
743-21-195
MF Hardingen
1993
2 631-86-399
MF Sveio
1975
662-26-200
MF Hidraferja
2001
595-36-128
MF Tidefjord
2008
2 980-120-350
MF Hidrasund
1972
113-10-98
MF Tidesund
2008
2 980-120-350
MF Hidrasund ll
1969
307-23-128
MF Ullensvang
1986
2 871-106-399
MF Hjelmeland
1992
1 183-76-400
MF Utstein
1975
821-36/47-240
MF Hordaland
1979
1 184-64-298
MF Vikingen
1992
2 631-86-399
MS Huldra
1974
438
MF Ytterøyningen
2006
632-38-160
MF Høgsfjord
1992
1 183-76-400
MF Ølen
1977
904-51-255
MF Ibestad
2014
1 599-74-225
MF Ørland
2006
875-50-190
MF Jondal
1974
748-35-195
annual report 2013
22
FLEET LIST AS OF 31 MARCH 2014 Express boats – Norled
Built
Grt.-Passengers
Built Grt.-Passengers
MS Baronen
2009
330-250
MS Teisten
2006
278-180
MS Baronessen
2008
228-180
MS Tideadmiral
2010
398-280
MS Fjordbris
2014
410-240
MS Tidebris
2001
224-180
MS Fjordbuen
2005
22-50
MS Tideekspress
2008
416-296
MS Fjorddrott
2007
226-180
MS Tidecruise
2008
179-147
MS Fjordfart
2007
226-180
MS Tidelyn
2009
192-125
MS Fjordkatt
2007
226-180
MS Tidevind
2008
190-147
MS Fjordsol
2005
98-97
MS Tiderose
2009
192-147
MS Frøya
2012
190
MS Tjelden
2013
135-47-2 pbe
MS Fjord Molde
2005
97-97
MS Tranen
2006
278-120
MS Lyse Ekspress
1988
47-60
MS Tyrving
2002
224-180
MS Lysefjord (66 %)
2006
230-85-12 pbe
MS Vingtor
2012
290
MS Njord
2012
290
MS Vøringen
1995
103-79
MS Tedno
2007
54-85
Det Stavangerske Dampskibsselskab AS Nedre Holmegt. 30 P.O. Box 40 4001 Stavanger Tel.: +47 51 84 56 11 Fax: +47 51 84 56 03 www.dsd.no e-mail: mail@stavangerske.no
Norled AS Børehaugen 1 P.O. Box 839 Sentrum 4004 Stavanger Tel.: +47 51 86 87 00 Fax: +47 51 89 54 25 www.norled.no e-mail: post@norled.no
DSD Shipping AS Nedre Holmegt. 30 P.O. Box 848 4004 Stavanger Tel.: +47 51 84 56 00 Fax: +47 51 84 56 01 www.dsd-shipping.no e-mail: mail@dsd-shipping.no
Nor Lines AS Nedre Holmegate 30 P.O. Box 655 Sentrum 4003 Stavanger Tel.: +47 51 84 56 50 Fax: +47 51 84 56 51 www.norlines.no e-mail: norlines@norlines.no
Tide ASA Møllendalsveien 1A P.O. Box 6300 5893 Bergen Tel.: +47 05505 Fax: +47 55 23 87 01 www.tide.no e-mail: post@tide.no
Cover Illustration: Nine new ships under construction with delivery to the DSD group in 2013-2014. From Top Left: Build no. 2709/1 MF «Stavanger» for Norled. Build no. 2709/2 MF «Hardanger» for Norled. Build no. 0033 MS «Kvitnos» for Nor Lines. Build no. 0032 MS «Kvitbjørn» for Nor Lines. Build no. 1696 Battery-powered ferry for Norled. Build no. 22 MF «Kvernsund» for Norled. Build no. 270 MF «Tjelden» for Norled. Build no. 21 MF «Ibestad» for Norled. Build no. 272 MF «Fjordbris» for Norled. grafica hundsnes
Photos: Tor Arne Aasen, Samferdselsfoto