The start of the year seems to be promising for the Russian shipping major Sovcomflot, as the first quarter ending March 31st saw a 9.2 percent increase in the company’s net profit reaching USD 103.1 million.

Time charter equivalent (TCE) revenues were up by 0.4 percent to USD 290.8 million, while the company’s EBITDA rose by 6.6 per cent to USD 187.5 million.

“The group’s successful performance in the period reflected a combination of Sovcomflot’s balanced chartering strategy and improved operational efficiency. In particular, this involved further optimisation of the fleet’s structure, in order to provide the right vessels to meet the market demand today,” Sergey Frank, President and CEO of PAO Sovcomflot, said.

During the period, Sovcomflot continued to replace low-yielding conventional vessels with a technologically modern fleet, which contributed to a significant increase in economic efficiency of SCF fleet’s operations.

“Sovcomflot’s credit metrics continued to improve in Q1 2016. With a strengthened cash position and with total debt reduced as compared to the end of the previous quarter the net debt ratio improved to 40.7 per cent. Meanwhile, EBITDA over the last 12 months was up to a robust USD 754.2 million, resulting in the net debt to EBITDA ratio going down to 3.2,” Nikolay Kolesnikov, Executive Vice President, Chief Financial Officer, commented.

As at 31 March 2016, Sovcomflot’s fleet comprised 140 vessels, 13 vessels less than in the corresponding period last year, with a combined deadweight of 12.2 million tonnes.

At this time, there were eight vessels under construction: one Arc7 ice-breaking LNG carrier of 172 600 m3 capacity; one multifunctional ice breaking (MIB) supply vessel; three MIB standby vessels and three Arc7 Arctic shuttle tankers each of 42,000 tonnes DWT, for delivery between July 2016 and April 2017.

On 15 January 2016, the launching ceremony was held for the world’s first Arctic LNG carrier at Daewoo Shipbuilding & Marine Engineering shipyard in South Korea. The vessel, ordered by Sovcomflot Group, will transport liquefied natural gas for Yamal LNG project along the high-latitude Northern Sea Route.

The vessel is a prototype for a series of 16 Arctic LNG carriers, and will be the first to load at the Port of Sabetta (Ob Bay, Kara Sea) which is under construction.

In February 2016, a 42,000 tonnes deadweight ice breaking shuttle tanker was launched for the group at Samsung Heavy Industries’ shipyard in South Korea. The vessel is the prototype of a series of three arctic tankers, and will be used to transport crude oil for Gazprom Neft from the Novoportovskoye field.