Höegh LNG of Norway reported USD 27.7 million in total consolidated income for the first quarter 2012, up 7% from USD 25.9 million in the same quarter last year.
The income includes USD 1.5 million of revenue from engineering work relating to a floating production solution for the Tamar gas field offshore Israel. The increase in income is also affected by the dry docking of Arctic Lady in February with USD 1.1 million in off-hire and by the replacement of the propeller shaft seal of the same vessel in the first quarter 2012 with a net negative effect on total income of USD 0.8 million.
Operating profit before depreciation was USD 5.8 million in the quarter, down from 6.7 million in the first quarter 2011, while ordinary loss before tax was USD 3.9 million, compared to a loss of 4.3 million in the same quarter in 2011. The quarterly figures include a non-recurring negative effect of USD 1.2 million, which was the net financial effect of changing the propeller shaft seals on Arctic Lady. An employee bonus provision and a stock option programme cost totalling USD 0.4 million are also included in the expenses in the first quarter of 2012, compared to nil in the same period last year.
The useful life for accounting purposes for the Group’s vessels has been reviewed, and from 1 January 2012 it has been changed from 30 to 35 years. Depreciation cost relating the Group’s vessels is therefore lower by USD 0.6 million in the first quarter of 2012 compared to the same period last year. Net cash flow from operating activities was negative by USD 6.9 million in the quarter due to the payment of cash collateral relating to project guarantees, down from a positive USD 2.5 million in the same quarter last year. Net cash flow to investing activities was USD 181.6 million, notably consisting of net investments in marketable securities of USD 95.0 million and investments in vessels and newbuildings of USD 79.4 million.
Net cash flows from financing activities was USD 190.0 million, including USD 202.0 million of net share issue proceeds. The net decrease in cash and cash equivalents for the period was therefore USD 1.6 million. The Group’s financial position has strengthened during the first quarter due to new equity raised. At the end of the first quarter 2012, the group held USD 38.2 million in cash and cash equivalents, up from USD 20.0 million as at 31 March 2011, as well as USD 185.6 million in marketable securities, up from USD 51.9 million in promissory note at the end of the first quarter 2011. The equity has increased from USD 75.0 million at the end of the first quarter 2011 to USD 343.0 million one year later, mainly due to share capital increases during the period.
“We are pleased to have secured long-term contracts for two new FSRUs and ordered a third vessel during the quarter. We believe the market outlook is good and we continue our efforts to expand our business,” said Sveinung J.S. Støhle, President and Chief Executive Officer of Höegh LNG.