President’s views

During the fourth quarter, Concordia Maritime’s business activities continued to develop according to plan. The result after tax amounted to SEK 18.9 (30.2) million and the EBITDA was SEK 56.0 (41.8) million.

Comments on the result

The tanker markets continued to be weak during the fourth quarter.
When summing up 2010, we can note that, just as expected, it was yet another weak year. During the year, the average freight rates on the spot market were barely USD 9,000 per day for product tankers and around USD 28,000 per day for suezmax tankers.

Despite the weak market, it was a good year for Concordia Maritime. The company’s business activities developed according to plan and generated a positive result that was somewhat better than expected. The freight rates in the charter contracts for the P-MAX and the panamax tankers continued to be much higher than the rates on the open market. On average, the charters generated just over USD 20,000 per day.
All our vessels performed well and we did not have any accidents or incidents.

Future prospects

The determining factor behind the weak market trend is a sharply increasing tanker fleet, which has resulted in an imbalance between supply and demand. In the last two years, supply has outstripped demand by a wide margin although the fleet will grow more slowly in 2011. In terms of demand, most of the parameters appear to be positive. Our assessment is that the product tanker market will slowly but gradually improve. 2011 will probably be yet another weak year, while the prospects for a market in balance are good in 2012 and particularly in 2013.
Our own financial position continues to be stable, giving us the capacity to make further investments when the right opportunities arise.

Forecast for 2011

In 2011, Concordia Maritime will be exposed to some extent to the open market. A P-MAX tanker will be redelivered from its charter during the summer and during the first two quarters, our exposure is in the form of a chartered suezmax tanker and a chartered aframax tanker.
Our assessment is that in the financial year 2011, Concordia Maritime will achieve a result before tax of USD 10–13 mil- lion, corresponding to SEK 65–85 million, depending on how the market develops.