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Shipping – a money machine
There is money in shipping. I have used the phrase before, but at the time of writing these words it is the season for the annual accounts. And this is happy reading. One after the other the maritime companies reveal multi-million profits after a healthy and prosperous 2006 with a good market in nearly all sectors, where most owners and operators had the correct timing to harvest in the market. This fact makes it even more interesting and easy to campaign to recruit youth to the maritime industry. The key word should be up, up and away.

It is not all-corporate prosperity that is the result of 2006. A large number of personal bonuses paid out after the 2006 figures are already making a number of employees more than happy. D/S “Norden” paid out DKK 55 million in bonuses. Some DKK 32 million of the money has been paid out to 52 employees, giving them an average extra bonus of DKK 615,300. A really nice extra wage to carry home to the bank.

What other job gives this kind of extra money at the end of the year? Not many in industrial jobs or office administration, I imagine.

Dampskibsselskabet Torm, the second large Danish shipping company, showed high figures in the annual accounts, with a total profit of DKK 1.2 billion, but more interesting is that the dry cargo division made a profit of DKK 500 million from 18 panamax bulk carriers. It is also highly interesting that the profit was made with only five employees in the department at Torm. It shows five highly profitable employees for Torm, and I guess that they have worked out a nice bonus for themselves at the end of year. Also a nice example to show to the school children before choosing their future career.

The theme in this magazine, Tanker Technology, was one of the highly profitable segments during 2006 and the prospects for 2007 are promising, even in the years to come, as there still is high demand for quality tonnage. Despite the many tankers under construction, the next couple of years will not show any signs of over-tonnage.

As one of the major players in the world in carrying products, Torm will gain a large sum of money from the sale of shares in D/S “Norden”. What they will do with the money is still a secret within the Torm office at Tuborg Havn in Copenhagen with a nice, clear view of Øresund. But there are rumours in the market that they will be spending money to purchase the US operator OMI, which could add a lot more tanker business to Torm and make it the leading product-tanker operator in the world. Torm also holds the world’s largest contract for shipping clean petroleum products (CPP). The contract is with Kuwait Petroleum for shipping all CPP from Kuwait to both east and west.

Another large Danish tanker operator is Maersk Tankers, part of the A.P. Møller-Mærsk Group, which operates 85 tankers in sizes from 16,000 DWT to 305,000 DWT. They had a nice year in 2006 and contributed to the group result of DKK 16 billion with DKK 5.7 billion (the figure also includes profit from offshore activities). Of the profit, some DKK 2.0 billion comes from the sale of ships. The tanker department paid DKK 498 million in tax of the DKK 20 billion paid in tax in 2006. Like Torm, Maersk Tankers have a substantial order book. Maersk Tankers have 38 units under construction in LNG, LPG and products.

So no doubt the Scandinavian majors will continue to play a significant role in the tanker business in the future, with the business conducted by those young people of both sexes that in coming years will carry the load of opportunity in shipping.

//Bent Mikkelsen