Belships generated operating income for the first quarter of USD 16.0 million (1999: USD 8.0 million). The increase was attributable primarily to greater activity in Panmax bulk and generally higher rates in all the group’s segments. Belships recorded an operating result for the period of USD -0.1 million (USD -1.2 million), with all parts of the group improving their performance. The net result for the period was USD -1.5 million (USD -2.4 million).
The product carrier business generated an operating result of USD 0.2 million (USD 0.0 million), the gas carrier business an operating result of USD -0.3 million (USD -0.5 million), the Panmax/Capesize bulk business an operating result of USD 0.1 million (USD -0.3 million), the Handymax bulk business an operating result of USD 0.4 million (USD -0.1 million) and the ship management business an operating result of USD 0.0 million (USD 0.0 million).

A better market balance brought higher rates in all the group’s segments.
The Handymax bulkers M/S Belnor and M/S Belstar were fixed on time charters in March running through the summer at rates of USD 9,750 and USD 9,000 per day respectivly, up USD 1,250 and USD 1,500 on their previous fixtures.
The Capesize bulker M/S Belmaj continued on its charter, which expires in the autumn.
Belships Trading improved its performance in the first quarter, but high bunker prices and an unexpectedly strong market mean that further improvements in the second quarter are not anticipated.
The product carrier M/T Urai continued on its long-term bareboat charter while the other product carriers sailed in the spot market at rates slightly above the 1999 average.
At Gibson Gas Tankers, the M/T Lanrick’s time charter was extended in March by 12 months at a rate of USD 185,000 per month, up USD 16,500 on 1999. The market for the three 6,000 cbm vessels the pool managed by Anthony Veder improved during the period but will not give full impact on the results until later this year. The first-quarter results were adversely affected by two gas carriers having to dry-dock during the period on account of rudder problems.

Belships’ liquid assets climbed from USD 8.5 million on 31 December 1999 to USD 8.7 million on 31 March 2000 and its mortgage debt decreased from USD 88.0 million to USD 86.9 million. Shareholders’ equity at the end of the quarter was equivalent to 19.4% of assets and USD 1.6 or NOK 13.5 per share. Belships intends to strengthen its equity base through a NOK 50 million rights issue in the second quarter. The issue has been underwritten by the company’s principal shareholders.
The fleet’s estimated market value at the end of the quarter was USD 1.3 million above its book value, an improvement since the start of the period when its market value was on a par with its book value.

The markets in which Belships operate are improving and the recovery is expected to continue for some time. However, capacity in the shipbuilding sector remains high and may result in a surplus of tonnage in the longer term. It is therefore important for Belships that the long-term freight contracts entered into actually materialise; we expect a final decision to be made in June/July.

For complete report including tables, follow the enclosed link:

Oslo, 26 April 2000

The Board of Directors of BELSHIPS ASA