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Presentation 27 October 2005. Consolidated WW-group ( Management report ). HIGHLIGHTS Quarter EBIT adjusted for one off items and Unitor contribution is in line with Q3 2004 which was last years strongest quarter

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Consolidated ww group management report
Consolidated WW-group (Management report)

HIGHLIGHTS

  • Quarter EBIT adjusted for one off items and Unitor contribution is in line with Q3 2004 which was last years strongest quarter

  • Shipping; Continued strong volumes throughout Q3, somewhat offset by the high bunker oil and space charter costs as well as strikes in Korea (EUKOR)

  • Logistics; Weak CAT performance leads to write down of 14 MUSD in Q3 – eased off by strong contribution from other investments

  • Maritime Services; Restructuring costs of 28.1 MUSD related to the Unitor acquisition is included in Q3 (one off), and Unitor is consolidated from July 15th

  • Financial instruments changes in market valuations of bunker hedging, interest and currency swaps contribute with 13.6 MUSD in Q3 and 29.7 MUSD YTD



Net financial items
Net financial items

  • Net financials (excl. financial instruments) improvement of 27.1 MUSD from YTD 2004

  • FX improvement of 15.1 MUSD from YTD 2004. However, negative market valuation of certain financial instruments related to this gain.

  • Financial instruments improvement of 11.5 MUSD from YTD 2004


Financial instruments
Financial instruments

  • Unrealized gain on bunker hedge contracts MUSD 16.9 for Q3 and MUSD 51.0 YTD 2005

  • Cash received on bunker hedge contracts reduces voyage expenses by MUSD 12.3 for Q3 and MUSD 26.6 YTD 2005

  • Interest rate swaps not qualifying for hedge accounting – IAS 39. gain Q3 MUSD 7.3/ gain YTD MUSD 8.6

  • Loss (YTD MUSD 29.8) on cross currency interest rate swaps partially offset by agio gain (MUSD 16.1)


Consolidated balance sheet ww group
Consolidated Balance Sheet – WW-group

Effect of UNITOR

245

90

220

115


Earnings per share
Earnings per share

USD

  • Unrealized gain on financial instruments 0,29 (Q3) / 0,62 (YTD) USD per share 2005 vs 0,14 (Q3) / 0,38 (YTD) USD per share 2004

  • Option expense equal to 0,05 USD per share Q1 2005



Shipping management report
Shipping (Management report)

EUKOR

  • Expected strike in HMC/KMC (Korea) at end August through mid September produced negative Q3 and full year EBIT effect of approx. 5 MUSD (WW Share) – However EUKOR EBIT Q3 2005 vs Q3 2004 was only negative by MUSD 1.0

  • 10% increase in cargo loaded vs YTD 2004

  • Note: Change of accounting estimate boosted Q1 revenue and profit by approx. 7 MUSD (WW-share)

WWL

  • 15% revenue increase from YTD 2004

  • Increased revenues in all cargo segments; cars, High & Heavy and NCC

  • All main trades remain strong in terms of both volumes and earnings

  • High bunker prices, transshipment and T/C costs for short term hired tonnage continue to offset revenue increases


Shipping management report1
Shipping (Management report)

COMMENTS TO KEY FIGURES

  • EBIT has increased by 17% vs Q3 2004 and increased 32% vs YTD 2004

  • Sales gains of MUSD 8.2 in Q3 2005 from the sale of 2 vessels from 100% owned companies to 50% owned Fidelio Ltd. Partnership

  • Gain from revaluation of unrealized portion of financial instruments of MUSD 18.0 in Q3 2005 (MUSD 50.1 YTD) vs MUSD 6.9 in Q3 2004 (MUSD 18.1 YTD)

  • Net profit is up 39% vs Q3 2004 and up 63% vs YTD 2004

  • Fleet utilization is still very high while the charter market for tonnage is tight

  • 2 new PCTCs have been added to WW fleet capacity YTD 2005 (Toledo & Toronto)

  • Additional 25 new and rebuilt vessels are scheduled to strengthen the WWL/EUKOR fleet over the next 2-3 years


Logistics management report
Logistics (Management report)

  • CAT / GAL is continuing to perform weaker than expected and several initiatives have been implemented to improve the situation

  • Total revenues up in spite of Richard Lawson deconsolidated from Q3 2004

  • US operations are performing very well. revenue increase of 21% vs Q3 2004 (12% vs YTD 2004)

  • Terminals are performing well. Increase in revenues (volume)

  • Distribution and Auto Service (DAS) included from June 2005

  • Glovis contribution is above expectations and is expected to continue its growth. WW-group ownership will be reduced in connection with an Initial Public Offering (IPO) of the company at the end of Q4 2005


Logistics management report1
Logistics (Management report)

  • CAT/GAL is performing weaker than expected and several initiatives have been implemented to improve the situation – write down of investment in CAT/GAL of MUSD 14.0 included in Q3 2005

  • US operations are performing very well. EBIT increase of 34% vs Q3 2004 (24% vs YTD 2004)

  • Terminals are performing well over all and according to expectations

  • Distribution and Auto Service is performing well and according to expectations

  • Richard Lawson (European Continent) is performing well and according to expectations

  • Glovis contribution is above expectations and is expected to continue its growth. WW-group ownership will be reduced in connection with an Initial Public Offering (IPO) of the company at the end of Q4 2005


Maritime services management report
Maritime services (Management report)

  • Unitor consolidated from July 15th

  • Growth in ongoing operations – mainly driven by strong growth in Port Service & Logistics

  • Ships Equipment and Ship Service division are main drivers going forward

  • EUKOR ship management contract for 11 vessels secured and LNG breakthrough

  • Maritime services merge and restructuring according to plan


Maritime services management report1
Maritime services (Management report)

  • Weaker overall result due to expenses from the incorporation of WMS (Start-up and project expenses) and inclusion of restructuring costs (MUSD 28.1) in Q3 2005

  • Ongoing operations better than last year – driven by very good results from Port Service & Logistics

  • Unitor results consolidated from July 15th and performing well. EBIT MUSD 6.1 included in Q3

  • In addition, expenses related to option program in Q1 2005 (MUSD 1.2)


Holding management report
Holding (Management report)

  • Continuing strong results from Dockwise. Share of profit 6.2 MUSD YTD 2005 vs 5.1 MUSD YTD 2004 (3rd Quarter 2005 1.6 MUSD vs. 1.5 MUSD)

  • Abeer Marine Services (AMS) to create a new JV with Svitzer Wijsmuller

  • AMS crew vessel business performing according to plan

  • Expenses related to option program in Q1 2005 (MUSD 1.0)

  • USD/NOK change has negative impact compared to prior year

    (Avg. NOK/USD: YTD 2005: 6.38 vs. 6.87 YTD 2004)