Stena Penguin is employed in Shell’s internal worldwide cargo system. The added capacity of the P-MAX is well-suited to such systems.

Concordia Maritime AB (publ)

FOCUS ON MAXIMISING THE UTILISATION

Concordia Maritime is an international tanker shipping company focused on safe, cost-effective transportation of refined petroleum products and vegetable oils. In 2014, Concordia Maritime celebrates its 30th anniversary. The company’s B share is listed on NASDAQ OMX in Stockholm.

Concordia Maritime’s shore-based organisation consists of only six people. A large part of daily operations in the form of chartering and crewing is instead purchased from partners in- and outside the Stena Sphere. The close cooperation means that Concordia Maritime can operate cost effectively at the same time that it has unique access to world-leading expertise in all shipping areas.

P-MAX: backbone of the fleet

The ten P-MAX vessels are the backbone of the fleet. These product tankers combine the highest safety standards with economical transport and load flexibility. In terms of length and depth, they are comparable to a standard type medium range vessel (MR). Thanks to their hull design, these vessels can transport about 30% more cargo, yet fuel consumption is practically the same as a standard MR vessel under comparable conditions.

Five of the P-MAX tankers have been converted to IMO3 class, so besides carrying light and heavy bunker oil products they can also transport vegetable oils and light chemicals. Eight of the vessels are designed for ice class 1B and two for ice class 1A.

The first of two product and chemical tankers in Stena’s IMOIIMAX series, which were designed in-house and ordered in 2012, will be delivered in late 2014. These 50,000 dwt tankers will be among the most sophisticated in the market and in the forefront in terms of cargo flexibility and energy efficiency.

The business cycle has bottomed out

The current business cycle has been very challenging for shipping companies around the world for several years. From this perspective, Concordia Maritime has managed well thanks to long-term contracts that bridged the years 2009–2012. Last year was something of a disappointment, however. After the first three quarters a clear improvement versus 2012 could be seen and the product tanker segment declined significantly at the start of the fourth quarter, partly due to seasonal reasons.

At the end of the year the market changed with a major upswing, which continued into 2014. By all indications, the business cycle has now bottomed out and the product tanker market appears to gradually strengthen in the years ahead. This is partly due to the global recovery, which generally leads to higher demand for oil. There are a number of structural drivers as well, including changes in global refinery capacity and the shale gas boom in the US, which suggests increased demand for transports in niche segments such as product and chemical tankers.

CEO Comment

As the new CEO of Concordia Maritime, my focus is on improving the fleet’s utilisation rate and thereby raising earnings. Since the majority of our vessels are now employed in the spot market, we are well-positioned to benefit from the market’s expected turnaround. We are also trying to steer employment toward trader and chartering systems, where we can take full advantage of the P-MAX’s unique features. At the end of 2014 we take delivery of the first of two sophisticated product and chemical tankers. With their load flexibility and energy efficiency, these vessels will help us to stay profitable and create opportunities for growth.

Kim ullman

CEO Concordia Maritime AB

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