Financial review

The ocean segment

WWL’s main objective for the ocean segment is to strengthen its position as the RoRo shipping market leader with unrivalled high & heavy and breakbulk capabilities.

Summary of 2017
Total income for the ocean segment for the full year of 2017 was USD 3 125 million, up 6% compared with 2016. The improvement is driven by an underlying recovery in the demand for deep sea transportation combined with an increase in BAF due to higher cost of bunker partly offset by lower net freight/CBM. Transported volumes increased from 64 million cbm in 2016 to 69 million cbm in 2017, up 8%. The cargo mix developed positively in 2017 due to a partial recovery in the markets for high & heavy equipment, and the high & heavy equipment share of transported volumes increased from about 24.5% in 2016 to about 25.6% in 2017.

EBITDA in 2017 ended at USD 587 million and EBITDA adjusted for extraordinary items came in at USD 615 million, an improvement of 17% compared with the full year of 2016. The improvement was driven by an increase in transported volumes, improved cargo mix coupled with a more favourable trade mix, higher utilisation out of traditional export areas such as Asia, Europe and North America, strong project cargo shipments in the Atlantic, and realisation of targeted synergies.

The fleet
At year-end 2017, WWL operated a core fleet of 126 vessels with carrying capacity of 864,000 car equivalent units (“CEU”) accounting for about 20% of the global car carrier fleet. In addition, WWL had six vessels on short-term time charters (contracts up towards one year). The size of the core fleet was stable throughout 2017 while the number of short-term charters increased in the second half of 2017 due to increased volumes. Currently, WWL has the flexibility to redeliver 10 vessels in 2018 and 22 vessels in the period from 2019 to 2023.

During 2017, WWL took delivery of two newbuildings on EUKOR’s account, exercised one purchase option on chartered vessels, and concluded two sale-leaseback transactions for a total of four vessels. The number of owned vessels decreased from 77 to 76 vessels at the end of the fourth quarter.

Four Post-Panamax vessels are under construction with combined capacity of 32,000 CEU. Two of these vessels are expected to enter service in 2018 and two are scheduled for delivery in 2019. The outstanding instalments for these vessels total USD 170 million. The newbuildings have been financed through regular bank facilities.