Tough market conditions in the Cruise & Ferry business area of STX Europe, the Oslo based shipbuilder whose owner is the South Korean STX Business Group, although some brightening of the outlook emerged in the course of the latest quarter.
“Market conditions in the third quarter remained challenging. However, during the last couple of months several new cruise vessel orders have been placed and there are potential for other new building projects in the market,” the company said in a statement.
“While the larger cruise operators have better access to financing, others need longer time to secure funding for their new building projects in the current market and economic situation. At present activities in the ferry segment are particularly low and are expected to increase only as the economic outlook will improve.”
“Both STX Finland and STX France are strongly focusing on securing new orders and continue with the improvement programmes to improve competitiveness. This includes also increased efforts within certain other market segments such as vessels for naval operations as well as offshore and renewable energy/wind related deliveries,” the company said.
The Cruise & Ferry business area generated an EBITA negative by NOK 39 million in the third quarter compared to a positive figure of NOK 50 million in the same period last year. For January-September, the fresh figure was NOK 150 million in the red compared to NOK 20 million in the black a year earlier. Operating revenues remained fairly stable year on in both review periods, but order intake plunged to NOK 434 million in the nine month period from NOK 10.0 billion a year earlier. A recent order for a 99,300 gross ton ship from TUI Cruises at STX Finland is not included in the January-September figures.
STX Europe repeated that it is committed to remaining a world leading shipbuilder of cruise vessels and ferries through securing new orders. “The focus in ice- breaking/arctic tonnage remains a key strategic focus, predominantly in Finland.” The continuing main focus of STX Europe is to secure new orders and continue to improve its profitability and competitiveness, especially within the Cruise & Ferries business area. The business area will further develop its diversification into other market segments such as offshore and renewable energy related deliveries.
The cruise vessel market remains challenging, but there are some signs of gradual improvement. Several new orders have recently been placed and there are a few other potential new building projects currently in the market. However, competition is very tough and some operators are still constrained by the limitations of financing of projects in today’s economic climate. The continuation of solid expansion in cruise business will, however, secure the market for further contracting of newbuildings.
In September 2012, a sand dredger was delivered from the Lorient shipyard. The order book at the Saint-Nazaire yard at the end of the quarter consists of two cruise vessels, one for Hapag Lloyd and the other for MSC, and two Mistral class helicopter carriers to be delivered to the Russian defense export agency Rosoboronexpor. The order book at the Rauma shipyard at the end of the third quarter consisted of a double-ended ferry for Finferries and an offshore patrol vessel for the Finish Border Guard. The order book at the Turku shipyard at the end of the quarter consisted of a large cruise ship for TUI Cruises and a cruise ferry for Viking Line.
The order book for Arctech Helsinki Shipyard (‘AHS’) at the end of the quarter consisted of a multipurpose emergency & rescue vessel and two multifunctional icebreaking supply vessels for a Russian owner.
