Stena AB

Stena Finance

Stena Finance’s main task is to manage the funding requirements of the Stena Group, both short and long term. Stena Finance also manages the operational business units’ financial risks in the interest rate, currency and oil markets. In addition, Stena Finance manages the Group’s liquidity and financial investments. Another important role is to act as a resource for the operational units when identifying, analysing and conducting new business deals.

Strong liquidity contributes to great flexibility

The global economy’s positive development continued in 2017. Overall, stock markets are strong, growth is high and interest rates remain low. Oil prices rose in the second half of 2017, increasing from USD 40 per barrel to over USD 60 as we entered 2018.

For the first time since the 2008 financial crisis, we are now ­seeing synchronised global growth of almost four percent for 2018. In 2017, the UK was less affected by the Brexit process than expected. Most emerging economies are developing well.

INCREASED HOLDING OF TECH SHARES

The balance between investments in the equity market and the bond and interest rate market has been relatively stable. The general price increase on the world’s stock exchanges has contributed to the positive development of Stena’s investments. Stena has experienced a very good return on its equity holdings, but also in the bond market, with a return of 12 percent.

In 2017, Stena largely retained the same positions for the company’s equity holdings, but with an increased holding of tech shares, such as e-commerce and gaming. Stena’s holdings are distributed among about sixty companies on exchanges in the Nordic region, the rest of Europe, the US and Asia. The value of Stena’s portfolio, which includes interest-bearing securities but excludes Adactum’s holdings, has increased by 12 percent.

RENEWED LOANS FOR LNG VESSELS

In February 2017, one of Stena’s outstanding bonds expired and Stena repaid EUR 300 million. During the year, Stena refinanced the loan for Stena Bulk’s three LNG vessels, with essentially the same syndicate as before and under the existing conditions.

A strong cash flow and further measures, such as the sale of mainly commercial property in Stena Property’s portfolio, mean that Stena maintains its strong liquidity. Over the next few years, Stena will also focus on ensuring a high level of liquidity, leaving the Group well equipped to face the challenges of the coming years.

We are global.

Peter Claesson

CEO, Stena Finance

For Stena, the rate of investment in recent years has been marked by caution and Stena will remain selective in terms of new projects over the coming years. Our flexibility has been maintained at a high level by continuing to focus on high liquidity. Our high level of liquidity and favourable maturity profile, combined with future cash flows, means that we are well-equipped for future challenges. One such challenge could be a decision by influential central banks to normalise their ­monetary policy, which would adversely affect growth and financial markets.

LIQUIDITY1)

 

1) Stena Group at 31 December 2017

INTEREST-BEARING LIABILITIES1)

 

1) Stena Group at 31 December 2017

INVESTMENT PORTFOLIOS1)

 

1) Stena Group at 31 December 2017