Record charter rates fuel OMI’s profits

Record charter rates fuel OMI’s profits    OMI Corp., the Stamford, Conn.-based tanker operator, reported a record fourth-quarter net income of $108.5 million up 647 percent, and an all-time high annual net income of $245.7 million for 2004 up 221 percent, as it took advantage of the tanker shipping boom.
   Net income increased $94 million over the $14.5 million earnings made in the fourth quarter of 2003.
   “Rates achieved in 2004, especially in the fourth quarter, were some of the highest historically in the oil tanker industry, as a result of higher-than-expected demand for oil products increasing the demand for tankers,” said Craig H. Stevenson, Jr., chairman and chief executive officer of the OMI.
   The average “Suezmax” time charter equivalent rate in 2004 was the highest since the early 1970s, the company reported. This was the result of strong world oil demand due to improving world economic activity especially in the United States, China and Southeast Asia; slower than anticipated return of nuclear plants taken off-hire for safety inspections in Japan; and the decline of the U.S. dollar.
   Revenues increased 141 percent to $207.6 million in the fourth quarter. OMI said it continues to expand its fleet size through the acquisition of modern vessels. During the fourth quarter, OMI took delivery of three product carriers built in 2004.
   For the year, net income of $245.7 million “was higher than net income reported in any of the fiscal years from the company’s inception in 1998,” OMI said. Revenue rose 75 percent to $564.7 million from $323.9 million in 2003. The company’s net income as a percentage of revenue climbed to 44 percent in 2004 from 24 percent in 2003.
   OMI completed the sale of its last two non-double-hull vessels in January.
   “Compliance with 2003 International Maritime Organization regulations for the phasing out of the majority of single-hull vessels by 2010 is no longer an issue to be addressed by the company, customers or investors,” OMI said.