Stena RoRo

EXPERTISE IS OUR COMPETITIVE EDGE

Stena RoRo provides vessels, innovative solutions and project management. Its customers are operators and shipping companies around the world. The company’s expertise, dedication and financial resources create customer value, growth and profitability, and make it an attractive place to work.

The European RoRo and RoPax markets have been challenging for a number of years. Stena RoRo, which charters out vessels to other companies mainly in Europe, is naturally affected by these market conditions, but is standing up well against the competition. Due to the weak market, Stena RoRo has been able to invest counter-cyclically in ten vessels during the last three years. The company buys ships when demand is low, renovates them in order to charter them out and eventually  sell them when the market improves.

The RoRo segment is still affected by oversupply of vessels. A large number of ships were ordered before the financial crisis and delivered around 2010.

The RoPax market is in better balance. The market has virtually no newbuilding to speak of and we are also seeing scrapping of smaller and older vessels and a rearrangement of vessels – ships that were previously operated in European waters now being employed on Asian routes, for example. This means that ships on charters outside Europe are strengthening the European market, while older ships are phased out in Asia.

Renovated ship chartered out

Part of Stena RoRo’s business concept is to establish charter operations in markets where there is growth. With this in mind, the company chartered a RoPax vessel to the Chinese shipping company Bohai Ferries in June 2014. The vessel in question, Hoa Sen, had been laid up for more than two years when Stena RoRo bought it from the Vietnamese state shipping company Vinalines. After five months of extensive renovation, the vessel is now on charter between China and South Korea, under the name Stena Egeria.

Stena Alegra will again be chartered out to the state shipping company Interislander of New Zealand. The prelude to the deal was a damage to one of Interislander’s ships in late 2013 leaving Interislander in great need of a replacement vessel. Stena RoRo’s response meant that the companies were able to quickly agree on a six-month charter contract, and a month later Stena Alegra was delivered to Wellington in New Zealand.

The new and longer arrangement means that the vessel has to undergo an extensive upgrade and refurbishment to meet the customer’s requirements for the route. The ship will have stabilisers installed and new customised interiors. These works will be completed in a shipyard in Singapore. This is a good example of Stena RoRo’s long-term ambition of delivering optimised vessels to our customers.

Another major event of the year is the purchase of Dieppe Seaways, now renamed Stena Superfast X. Stena RoRo negotiated and completed the transaction on behalf of Stena Line. The acquisition was made at favourable terms. Before the ship was taken into service in February 2015, it underwent an extensive upgrade and ­customisation for Stena Line’s Irish Sea routes.

To secure Stena Line’s tonnage requirements on the Irish Sea, Stena RoRo was commissioned by Stena Line to renego­tiate two long contracts for Stena Superfast VII and Stena Superfast VIII.

The Mercy Ships Foundation provides advanced free medical care on board the world’s largest civilian hospital ships in some of the poorest countries in the world. At the end of 2013, the Foundation ordered another ship and Stena RoRo was commissioned to carry out the transaction on a commercial basis. Stena RoRo has designed and procured the ship and is responsible for project management and supervision during the ­construction period.

Stena RoRo

Stena RoRo is one of the leading innovators of the roll on/roll off cargo concept.

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CEO comments

Over the next two years, the RoRo market is expected to remain challenging, although the outlook appears somewhat brighter for the larger ice-class RoRo tonnage with scrubbers installed. In 2015, new stricter sulphur regulations are being introduced within the Sulphur Emission Control Areas (SECA) and will affect the entire industry in the areas where the new directive applies – for our operations this is particularly the case in northern Europe. For RoPax vessels, we see a balance between supply and demand, and we are of the opinion that the market will strengthen in the future.

PER WESTLING

CEO, Stena RoRo

Next in Annual Review 2014

NORTHERN MARINE GROUP

ANOTHER YEAR OF SIGNIFICANT DEVELOPMENT