Results per 31 March 2006

Belships recorded an operating income in the first quarter 2006 of USD 11,792,000 (first quarter 2005: USD 19,311,000). The company’s operating result totalled USD 592,000 (USD 2,783,000). The decrease in operating income was chiefly due to a lower level of activity and a reduction in rates.
The result after taxes was USD 506,000 (USD 1,894,000) for the first quarter.
The dry bulk market moved sideways or declined slightly in the first quarter, but the rates for Handymax ships in the Far East remained firm, despite significant newbuilding deliveries precisely in this area.
Elkem Chartering (EC) largely completed the rebalancing of its portfolio by returning tonnage, at the same time as future cargo obligations will increase.
EC Handymax vessels continued on their respective charters without any operational interruptions and their performance was on a line with that of the preceding quarter.
M/S Anangel Express made a positive contribution.
Belships’ own tonnage, the M/S Belnor and the M/S Belisland, also sailed on their time charters without any operational interruptions and with results as anticipated.
The company’s equity and financial position are sound.
At 31 March, the group had liquid assets of USD 12.7 million against USD 15.3 million at 31 December 2005. The company’s mortgage debt totalled USD 13.3 million at the end of the first quarter and has been reduced by USD 1.5 in the course of the period. Book value per share is NOK 4.55 and the book equity ratio at 31 March was 45.1%
The market value of the M/S Belnor is substantially higher than her book value.
As EC’s handysize operation now has little expensive tonnage, we expect that contributions will again be positive.
The M/S Anangel Express will be returned to her owner in the course of May.
The M/S Belisland, the M/S Belnor and EC’s Handymax vessels will continue to generate good earnings throughout the year thanks to their long-term charters.
The product tanker is due to be delivered in the course of May next year and will be delivered with its 5-year charter.

The market outlook is unchanged from the preceding quarter. We expect a decline in rates in the course of the summer, with probably no material reversal of this level in the autumn.

Oslo, 27 April 2006