CVR.no. 43 66 76 37
2023
Annual Report
Ultranav International ApS
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 ULTRANAV INTERNATIONAL AT A GLANCE | PAGE 2
TABLE OF CONTENTS
Ultranav International at a glance .................................................................... 3
Mission & vision ............................................................................................................... 4
Main activities .................................................................................................................. 5
A large and diversified shipping group ............................................................................. 8
Financial review ............................................................................................... 9
Group key figures and ratios .......................................................................................... 10
2023 financial performance ........................................................................................... 11
Our business .................................................................................................. 12
Sustainability .................................................................................................................. 13
Corporate governance ................................................................................................... 14
Signatures ...................................................................................................... 16
Statement by the Board of Directors and Executive Management ............................... 17
Independent Auditor’s Report ....................................................................................... 18
Consolidated financial statements .................................................................. 21
Consolidated income statement .................................................................................... 22
Consolidated balance sheet ........................................................................................... 23
Consolidated statement of cash flows ........................................................................... 24
Consolidated statement of changes in equity ................................................................ 25
Notes to the consolidated financial statements ............................................................ 26
Parent company financial statements ............................................................. 73
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 ULTRANAV INTERNATIONAL AT A GLANCE | PAGE 3
ULTRANAV INTERNATIONAL AT A GLANCE
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 ULTRANAV INTERNATIONAL AT A GLANCE | PAGE 4
Excellence
We seek to contribute to
competitiveness to our customers
by anticipating and meeting their
needs.
We encourage creativity and
innovation, introducing solutions
that are beyond the ordinary.
We strive to continuously improve
the quality and effectiveness of
services rendered.
Passion
We believe that personal
commitment and work well
done makes a difference.
We challenge ourselves to
create value and to exceed
customers’ expectations.
We are passionate about our
work and our company.
Integrity
We act in an ethical manner,
focused on sustainability and
safeguarding our reputation.
We encourage personal and
professional development and a
fair balance between work and
private life.
We promote team spirit in a
multicultural environment,
without discrimination of any
kind.
Safety
We are committed to developing
and stimulating a safe working
culture onboard ships and ashore.
We place safety first, to keep
health, life, environment,
cargoes, and assets free of risks.
We consider safety an integral
part of our mindset and key to
our business success.
Core values
MISSION & VISION
We aspire to be a partner you can
trust who provides efficient and safe
maritime transportation services to
the mutual benefit of our customers,
employees, communities and the
environment.
A partner you
can trust
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 ULTRANAV INTERNATIONAL AT A GLANCE | PAGE 5
MAIN ACTIVITIES
Tankers
Chemical tankers
Ultratank operates a modern fleet of about 22
stainless-steel chemical carriers of 20,000 dwt.
These vessels are employed in various trades
between North-, Central- and South America
carrying a vast range of products including organic
chemicals such as methanol and ethanol, as well as
inorganic chemicals such as sulphuric acid and
caustic soda, and other liquid cargoes in bulk such
as vegetable and animal oils.
Clean petroleum product tankers
Austral Product Tankers operates a fleet of about
eight Medium Range product tankers and the
commercial management of the fleet is done by the
joint venture CPTA which operates about 15 to 20
MR tankers. Trading patterns and commercial
footprint have a clear focus on the Americas. CPTA
is commercially managed by Product Tankers
Management Company (PTMC) which is a fully
owned Ultranav company.
Crude oil tankers
Cape Tankers operates a modern fleet of about 10
to 15 tankers in the Panamax and Aframax
segments. Whilst our trading activities have a global
reach, the focus is the transportation of crude oil
and dirty petroleum products within the Americas.
The commercial management of the fleet is done by
the joint venture Panamax International.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 ULTRANAV INTERNATIONAL AT A GLANCE | PAGE 6
MAIN ACTIVITIES
Dry bulk
Ultrabulk carries a broad range of dry cargoes, but
core products include minerals, coal, fertilizers,
grains, salt and steel. The fleet size of 165-200
vessels qualifies the company as one of the world’s
leading dry bulk operators within the Handysize,
Supramax and Panamax segments. The trading
platform supports customer’s local and worldwide
requirements.
Ultrabulk operates in a very competitive and
volatile market, and it is therefore important that
Ultrabulk remain adaptable and agile to match the
needs of our business partners.
Horizon Shipping is one of the major parcelling
operators for exports from the West Coast of South
America transporting around 6 million metric tons
of cargo per year – with a particular focus on west
coast South America, the Far East, the US Gulf, and
Europe.
The company has historically provided maritime
solutions to trading and mining companies,
supporting their development by growing together
and building long-term relationships.
Gas carriers
Since our foundation, Ultranav has been involved
in the transport of liquefied petroleum gases (LPG)
by sea via our business unit Ultragas. In 2021,
Ultragas and Navigator Gas merged their fleets and
businesses, becoming a global leader in the
handysize liquified gas carrier segment of seaborne
transportation services of petrochemical gases,
such as ethylene and ethane, liquefied petroleum
gas and ammonia. The fleet of Navigator Gast
consists of 56 semi or fully refrigerated liquefied
gas carriers.
Navigator also owns a 50% share, through a joint
venture, in an ethylene export marine terminal at
Morgan’s Point, Texas.
Ultranav holds 29% of the shares in Navigator Gas.
ASSOCIATE
COMPANY
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 ULTRANAV INTERNATIONAL AT A GLANCE | PAGE 7
MAIN ACTIVITIES
Other investments
Via Ultra Ventures we invest in industry-relevant
businesses and start-ups that we believe can
contribute positively to the maritime industry and
that develop products or technologies to support
one or more of our three focus areas:
Crew welfare, Safety, Environment & Climate.
We strive to find and support innovators in their
business journey towards our common goals in the
maritime industry: To make the industry better,
smarter, more sustainable and safer.
The investments are not just to the benefit of the
start-ups – the collaboration also serves as a great
inspiration to Ultranav as these businesses and
start-ups demonstrate other solutions, ways of
doing business and new trends.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 ULTRANAV INTERNATIONAL AT A GLANCE | PAGE 8
A LARGE AND DIVERSIFIED SHIPPING GROUP
Ultranav International ApS Group is part of the
Ultranav Group, a privately owned shipping
company active for over six decades and operating
globally with offices in 18 countries.
Through twelve business units, the Ultranav Group
operates in five market segments: oil, gas, dry
bulk, coastal trades, and towage & offshore.
Ultranav operates a fleet of gas and chemical
carriers, tankers for crude oil and clean petroleum
products, bulk carriers, feeder container ships,
multipurpose vessels, harbour tugs, PSVs, AHTS,
pusher tugs, barges and pilot boats.
As of 31 December 2023, Ultranav counts 3,771
employees (sea and shore) and operates a fleet of
417 ocean going vessels and tugs.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 FINANCIAL REVIEW | PAGE 9
FINANCIAL REVIEW
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 FINANCIAL REVIEW | PAGE 10
GROUP KEY FIGURES AND RATIOS
INCOME STATEMENT (USD '000)
2023
[A]
2022
[A]
2021
[B]
2020
[B], [C]
2019
Revenue
2,440,121
3,116,315
2,445,766
696,536
720,457
Gross profit (Net earnings from shipping activities)
508,695
552,989
335,258
148,317
168,479
Operating profit before depreciation, amortization and impairment loss (EBITDA)
434,686
478,273
274,529
127,156
143,219
Operating profit (EBIT)
293,579
302,261
75,938
66,692
49,712
Net financials
16,925
-12,808
-29,319
-4,070
-14,701
Profit before tax
366,600
309,873
43,110
62,622
35,011
Net result of continuing operations
347,685
304,002
40,831
62,622
35,011
Net result of discontinuing operations
-
-
-10,792
2,877
-
Net result
347,685
304,002
30,039
65,499
35,011
STATEMENT OF FINANCIAL POSITION (USD '000)
Non-current assets
913,108
947,770
984,522
656,446
741,693
Current assets
1,367,652
1,005,072
595,304
292,359
291,317
Total assets
2,280,760
1,952,842
1,579,856
948,805
1,033,010
Equity, incl. non-controlling interests
1,394,191
1,054,253
769,674
555,881
531,965
Non-controlling interests
17,444
20,174
13,672
9,158
6,332
Non-current liabilities
402,333
404,460
355,092
230,029
297,918
Current liabilities
484,236
494,130
455,090
162,895
203,127
Net interest-bearing (liabilities)/assets, including leases
354,287
91,300
-179,408
-97,131
-217,741
Net interest-bearing (liabilities)/assets, excluding leases
682,423
402,539
130,713
-32,925
-121,542
Cash and cash equivalents, including restricted cash
548,200
410,313
169,289
163,012
67,426
CASH FLOW (USD '000)
From operating activities
408,911
462,373
263,860
201,014
152,284
From investing activities
-41,635
-100,502
-246,578
43,251
-36,513
- of which relates to investment in tangible assets
-153,784
-109,436
-90,558
25,199
-61,305
From financing activities
-221,206
-136,555
-99,523
-148,679
-77,055
Total net cash flow
146,070
225,315
-82,241
95,586
38,716
Change in restricted cash
3,669
-11,145
-5,663
6,951
-2,678
Total net cash flow, excluding changes in restricted cash
142,401
236,460
-76,578
88,635
41,394
FINANCIAL RATIOS
Gross profit margin (Net earnings from shipping activities margin)
20.8%
17.7%
13.7 %
21.3 %
23.4 %
EBITDA margin
17.8%
15.3%
11.2 %
18.3 %
19.9 %
Return on equity (ROE)
[D]
24.9%
28.8%
3.9 %
11.8 %
6.6 %
Equity ratio
[D]
61.1%
54.0%
48.7 %
58.6 %
51.5 %
Gross Profit = (Gross Profit / Revenue), EBITDA margin = (EBITDA / Revenue), ROE = (Net Profit / Equity incl. non-controlling interests), Equity ratio = (Equity incl. non-controlling interests / Total Assets).
[A] Key figures and ratios for the financial years 2022 and 2021 have been adjusted to reflect the business combination of entities under common control which were completed in November 2022.
[B] Comparative key figures and ratios for the period 2019 – 2020 were not updated to reflect the business combination of entities under common control, which were completed in November 2022
[C] Comparative key figures and ratios, related to profit or loss, for 2019 were not updated to reflect the divestment of the Group’s gas carrier activities which were completed in August 2021.
[D] The Return on equity and equity ratio for 2021 and Equity ratio are based upon the equity at the end of 2021 as comparatives for the preceding year are not restated.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 FINANCIAL REVIEW | PAGE 11
2023 FINANCIAL PERFORMANCE
Results
Revenues amounted to USD 2,440 million, a 22%
decrease from last year’s revenue. The decrease in
revenues was linked to a normalised average
market in the dry bulk segment, while the tanker
segment remained strong.
Gross profit decreased to USD 509 million
corresponding to a gross margin of 20.8%, against
17.7% in 2022.
EBITDA decreased to USD 435 million against USD
478 million last year, corresponding to an EBITDA
margin of 17.8% (15.3% in 2022).
Depreciations amounted to USD 200 million (USD
178 million in 2022), mainly related to depreciation
on right-of-use assets and own vessels. Gain from
sale of vessels amounted to USD 59 million.
Financial items amounted to a net income of USD 17
million (net expense of USD 13 million in 2022).
Most financial items relate to interest income and
interest expenses on lease liabilities and bank loans.
Income tax amounted to USD 19 million (USD 6
million in 2022).
Net result amounted to a profit of USD 348 million
(USD 304 million in 2022), which is significantly
above the expectations set out last year of USD 125-
175 million. The increase in profit is linked to a
strong performance across both the tanker and dry
bulk segments as well as gains from sale of vessels.
Balance Sheet
Total assets increased to USD 2,281 million, against
USD 1,953 million in 2022. The increase in total
assets relate primarily to a strong cash generation
(USD 146 million).
Total liabilities decreased to USD 886 million
compared to USD 899 million in 2022. The majority
of liabilities comprise of lease liabilities which
amounted to USD 328 million at the end of 2023
(USD 311 million at the end of 2022), as well as
interest bearing loans of USD 289 million at the end
of 2023 (USD 276 million at the end of 2022).
Total equity increased to USD 1,394 million from
USD 1,054 million in 2022, driven by profit for the
year of USD 342 million.
Return on equity was 24.9% (28.8% in 2022) and
equity ratio was 61.0% at the end of 2023 against
54.0% at the end of 2022.
Cash flow
The cash flow for the year, excluding restricted cash,
netted at an inflow of USD 142 million against a net
USD 236 million last year.
Cash flow from operating activities was an inflow of
USD 409 million (USD 462 million in 2022), driven by
cash flows generated from the shipping activities,
while cash flow from investing activities was an
outflow of USD 42 million (outflow of USD 101
million in 2022).
Cash flow from financing activities was an outflow
of USD 221 million (outflow of USD 137 million in
2022) and is mainly related to repayment of lease
liabilities, loans, and interests (USD 241 million)
which were only partly offset by net inflows from
borrowings at financial institutions (USD 15 million).
Outlook 2024
Based on the Group’s current position, and the
expected market conditions, the Group expects net
result of the Group and the parent company in the
range of USD 125-175 million.
Financial risk management
A description of the financial risks, to which the
Group is exposed through its shipping activities, is
included in note 5.5 to the Consolidated Financial
Statements
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 OUR BUSINESS | PAGE 12
OUR BUSINESS
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 OUR BUSINESS | PAGE 13
SUSTAINABILITY
Ultranav is dedicated to showing environ-
mental leadership and exceed the mandatory
targets set by IMO. Every ton counts.
Ultranav is committed to achieving a 50% carbon
intensity reduction in emissions by 2030. We will
employ innovative technologies, invest in
sustainable practices, and collaborate with industry
partners and stakeholders to surpass the emission
reduction targets set by the International Maritime
Organization (IMO). This commitment aligns with
our dedication to environmental stewardship, and
we will transparently communicate our progress,
engage our employees in the journey, and adapt our
strategies to the evolving landscape. Ultranav is not
just aiming to meet regulations but to lead the
maritime industry towards a more sustainable and
decarbonized future.
Climate targets
Ultranav has identified the following climate
targets:
• By 2030, Ultranav is committed to reducing the
carbon intensity of the fleet by 50% compared
to 2008.
• By 2045, Ultranav aims to have a zero-emission
fleet in domestic commercial operations.
• By 2050, Ultranav is committed to having a zero-
emission fleet in international commercial
operations and to be climate neutral.
With the changes of the regulatory landscape, and
the latest update of the GHG strategy, it was
decided to update the pillars of our strategy and
adapt to the new landscape. The following pillars
were (re-)established: Energy on board; Industry
collaboration; Culture; Transparent reporting;
Regulations; and Pathway to zero.
More information
Statement on corporate responsibility, cf Danish
Financial statements Act, § 99a
Find more information about Ultranav International
ApS’ activities within climate & environment,
people and anti-corruption in our sustainability
report. The report is available on the following URL:
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 OUR BUSINESS | PAGE 14
CORPORATE GOVERNANCE
Corporate governance principles
The Board of Directors and Executive Management
of Ultranav International ApS are convinced that
efficient and clear division of responsibilities as well
as transparent decision-making processes are
prerequisites of a Group’s long-term value creation.
Ultranav International ApS therefore reviews at
least annually the Group’s corporate governance
practices and principles in accordance with
legislation, customs and recommendations. As part
of this process, the Board and Executive
Management review the Group’s strategy,
organisation, business processes, risks, control
mechanisms and relations with its shareholders,
customers, employees and other stakeholders.
Whistleblower platform
The Ultranav General Business Principles are the
commitment that we have undertaken with our
stakeholders about how to conduct business at all
times, based on our values and corporate culture.
Our stakeholders, be they employees, customers,
suppliers, the community or the competition, are
invited to raise their doubts and/or make
whistleblowing reports on the activities undertaken
by our organisation.
All information reported are treated in a
confidential manner. The Ultranav Ethical
Committee will critically evaluate all incoming
reports and address issues according to our
principles.
Our whistleblowing site is operated in partnership
with an independent third-party contractor that
guarantees the privacy or the anonymity of your
report and any information transmitted through
their website.
Remuneration of management
Board of Directors
The Board of Directors has refrained from receiving
any compensation for their work in 2023,
unchanged from 2022. In 2024, likewise, the
members of the Board of Directors intend to refrain
from receiving any compensation for their work. If
the Group’s activities require a temporary, but
extraordinary workload by the Board, a fee may be
authorised. Likewise, the members of the Board
receive no incentive pay for their work on the
Board.
Executive Management
Executive Management comprises of two members
who are employed on contractual terms fixed by the
Board of Directors.
Members of Executive Management receive a
competitive remuneration package consisting of a
fixed salary, benefits such as company phone, and
an incentive payment in terms of cash bonus.
Performance criteria for the cash bonus is tied to
earnings and business targets.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 OUR BUSINESS | PAGE 15
CORPORATE GOVERNANCE (CONTINUED)
ULTRABULK ANNUAL REPORT 2021 ACCOUNTS AND PERFORMANCE | PAGE 16
SIGNATURES
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 SIGNATURES | PAGE 17
EXECUTIVE MANAGEMENT
BOARD OF DIRECTORS
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 SIGNATURES | PAGE 18
INDEPENDENT AUDITOR’S REPORT
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 SIGNATURES | PAGE 19
INDEPENDENT AUDITOR’S REPORT (CONTINUED)
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 SIGNATURES | PAGE 20
INDEPENDENT AUDITOR’S REPORT (CONTINUED)
CVR no. 33 77 12 31
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 SIGNATURES | PAGE 21
CONSOLIDATED FINANCIAL STATEMENTS
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 CONSOLIDATED FINANCIAL STATEMENTS | PAGE 22
CONSOLIDATED INCOME STATEMENT
PROFIT OR LOSS
1 JANUARY – 31 DECEMBER
USD thousands
Note
2023
2022
Revenue
2.1
Vessel operating costs and voyage related expenses
2.2
-1,931,426
-2,563,326
Gross profit (Net earnings from shipping activities)
Other income
Other external expenses
6.2
-44,442
-33,708
Staff costs
2.3, 6.1
-30,362
-42,354
Operating profit before depreciation (EBITDA)
Depreciations and amortisations
3.3
-199,751
-177,530
Impairment charge on goodwill
3.1
-35,172
Gain/(loss) from sale of vessels, net
3.2
Operating profit (EBIT)
Share of profit from investments accounted for using
equity method
3.4
Gain from disposal of associates
3.5
Financial income
5.1
Financial expenses
5.1
-34,777
-26,279
Profit/loss before tax
Tax
2.4
-18,915
-5,871
Profit/loss for the period
Attributable to
Equity holders of the parent
Non-controlling interests
Profit/loss for the period
STATEMENT OF OTHER COMPREHENSIVE INCOME
1 JANUARY – 31 DECEMBER
USD thousands
Note
2023
2022
Profit/loss for the period
Items that will be reclassified subsequently to the
Consolidated Profit or Loss when specific conditions are
met:
Cash flow hedges, gain/loss for the year (net)
5.7
-12,669
Securities
Other items
-87
Other comprehensive income, net of tax
-12,756
Total comprehensive income
Attributable to:
Equity holders of the parent
Non-controlling interests
Total comprehensive income
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 CONSOLIDATED FINANCIAL STATEMENTS | PAGE 23
CONSOLIDATED BALANCE SHEET
ASSETS
USD thousands
Note
2023
2022
Goodwill, Customers Relations & Contractual
Rights
3.1
Vessels & right-of-use assets
3.2
Fixtures, fittings, and equipment
3.2
Intangible & tangible assets
Investments accounted for using equity method
3.4
Loans to related companies
4.1
Trade receivables from related companies
4.1
Derivative financial instruments
5.7
Deposits
Other receivables
4.1
Other financial assets
5.2
Deferred tax
2.4
Financial assets, non-current
Total non-current assets
Inventories
4.2
Trade and other receivables
4.1
Trade receivables from related companies
4.1
Loans to related companies
4.1
Prepayments
4.1
Derivative financial instruments
5.7
Other financial assets
5.2
Cash and cash equivalents, incl. restricted cash
4.3
Current assets
TOTAL ASSETS
EQUITY AND LIABILITIES
USD thousands
Note
2023
2022
Share capital
6.8
Retained earnings
Other reserves
Total equity of majority interests
Non-controlling interest
Total Equity
Other payables
4.4
Interest bearing loans and borrowings
5.3
Lease liabilities
5.4
Derivative financial instruments
5.7
Deferred tax
2.4
Total non-current liabilities
Trade and other payables
4.4
Payables to related companies
4.4
Loans payables to related companies
4.4
Interest bearing loans and borrowings
5.3
Lease liabilities
5.4
Derivative financial instruments
5.7
Income tax payable
Total current liabilities
Total liabilities
TOTAL EQUITY AND LIABILITIES
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 CONSOLIDATED FINANCIAL STATEMENTS | PAGE 24
CONSOLIDATED STATEMENT OF CASH FLOWS
Amount in USD thousands
Note
2023
2022
Profit/(loss) before tax
Instalments received from sub-lease receivables
Tax paid
-16,760
-354
Adjustment of other non-cash operating items
6.4
Change in working capital
6.5
-39,364
-29,415
Net cash flows from operating activities
Dividends received
Investments in tangible assets
-153,784
-109,436
Sale of tangible assets
Investment in associates
-6,829
-7,933
Loans to related companies, net
-57,214
-126,831
Interest on loans to related parties
Acquisition of subsidiaries
-18,997
Investment in other financial assets
-7,106
Investment in securities
-82,612
Change in restricted cash
4.3
-11,145
Other
Net cash flow from investing activities
-41,635
-100,502
Free cash flow
Dividends paid to equity minority holders
-11,137
-5,053
Raising of loans from financial institutions
6.6
Repayment of loans to financial institutions
6.6
-12,239
-89,075
Interest payments on loans to financial institutions
-18,896
-7,579
Repayment of loans from related parties
-10,229
-19,202
Interest payments on loans from related parties
-430
-4,011
Repayment of lease liabilities
6.6
-169,819
-161,312
Interest payments on lease liabilities
-13,071
-10,323
Net cash flows from financing activities
-221,206
-136,555
Net change in cash and cash equivalents
Amount in USD thousands
Note
2023
2022
Cash and cash equivalents at 1 January
Net change in cash and cash equivalents
Revaluation of cash deposits in foreign currencies
-4,514
Cash and cash equivalents at 31 December
Restricted cash
4.3
Cash and cash equivalents
Cash and cash equivalents, including restricted cash at 31 December
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 CONSOLIDATED FINANCIAL STATEMENTS | PAGE 25
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
USD thousands
Share
capital
Cash flow
hedge
reserve
Reserve for security
investments
Retained
earnings
Total
Non-controlling
interests
Total
equity
Equity as 1 January 2023
Net result
Cash flow hedges
-365
Revaluation of cash deposit in foreign currencies
-4,428
-4,428
-4,428
Share of other comprehensive income, Securities
Other comprehensive income for the year
-365
Total comprehensive income for the year
Distributed dividend
-11,137
-11,137
Other transactions with shareholders
-550
-470
Transactions with shareholders
-11,688
-11,607
Equity as 31 December 2023
Equity as 1 January 2022
Net result
Cash flow hedges
-16,882
-16,882
-16,882
Revaluation of cash deposit in foreign currencies
Other changes
-89
-89
-89
Other comprehensive income for the year
-12,669
-89
-12,758
-12,758
Total comprehensive income for the year
-12,669
Distributed dividend
-5,053
-5,053
Other transactions with shareholders
-359
-359
-1,253
-1,612
Transactions with shareholders
-359
-359
-6,306
-6,665
Equity as 31 December 2022
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 CONSOLIDATED FINANCIAL STATEMENTS | PAGE 26
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
SECTION 1: BASIS OF PREPARATION ............................................................... 27
1.1 Basis of reporting ..................................................................................................... 28
1.2 Significant accounting judgments and estimates ..................................................... 31
SECTION 2: PROFIT OR LOSS ........................................................................... 32
2.1 Revenues .................................................................................................................. 33
2.2 Vessel operating costs and voyage related expenses .............................................. 34
2.3 Staff costs ................................................................................................................. 34
2.4 Tax ............................................................................................................................ 35
SECTION 3: INVESTED CAPITAL ....................................................................... 37
3.1 Intangible assets ...................................................................................................... 38
3.2 Tangible assets & right-of-use assets ....................................................................... 39
3.3 Depreciations and amortisations ............................................................................. 43
3.4 Investments accounted for using the equity method .............................................. 44
3.4 Investments accounted for using the equity method (Continued) .......................... 45
3.5 Business Combination .............................................................................................. 46
SECTION 4: WORKING CAPITAL ....................................................................... 48
4.1 Receivables and prepayments ................................................................................. 49
4.2 Inventories ............................................................................................................... 50
4.3 Restricted cash ......................................................................................................... 50
4.4 Trade and other payables ........................................................................................ 51
SECTION 5: CAPITAL STRUCTURE .................................................................... 52
5.1 Financial items.......................................................................................................... 53
5.2 Other Financial Assets .............................................................................................. 53
5.3 Interest bearing loans and borrowings .................................................................... 54
5.4 Lease liabilities ......................................................................................................... 55
5.5 Risks arising from financial instruments ................................................................... 57
5.6 Financial instruments by category ........................................................................... 58
5.7 Derivative financial instruments .............................................................................. 60
SECTION 6: OTHER DISCLOSURES .................................................................... 65
6.1 Remuneration of management ................................................................................ 66
6.2 Fee to the statutory auditors ................................................................................... 67
6.3 Contingent liabilities & Commitments ..................................................................... 68
6.4 Other non-operating cash items (cash-flow) ............................................................ 69
6.5 Change in working capital (cash-flow) ..................................................................... 69
6.6 Changes in liabilities (cash flow) ............................................................................... 70
6.7 Related party disclosures ......................................................................................... 71
6.8 Share capital ............................................................................................................. 71
6.9 Events after the balance sheet date ......................................................................... 71
6.10 Group structure ..................................................................................................... 72
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 27
SECTION 1: BASIS OF PREPARATION
1.1 Basis of reporting
1.2 Significant accounting judgements and estimates
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 28
1.1 BASIS OF REPORTING
§ GENERAL ACCOUNTING POLICIES
Ultranav International ApS is a company domiciled in Denmark.
The Consolidated Financial Statements of Ultranav International ApS for 2023 have been
prepared in accordance with International Financial Reporting Standards as adopted by the
EU and additional requirements of the Danish Financial Statements Act.
Measurement basis
The Consolidated Financial Statements have been prepared on the historical cost basis
except certain financial assets and liabilities. These financial assets and liabilities have been
measured at fair value.
The Consolidated Financial Statements have been presented in USD thousands except when
otherwise indicated. The DKK/USD rate applied at 31 December 2023 was 674.47 (2022:
694.73) and the average DKK/USD applied for the year was 689.28 (2022: 707.82).
Apart from the general accounting policies, which are summarised in this note, the Group’s
accounting policies are described in each of the individual notes to the Consolidated Financial
Statements to which they relate.
The accounting policies, as described below and in the respective notes, have been used
consistently in respect of the financial year and the comparative figures.
New and amended accounting standards which are not yet effective
The new and amended standards and interpretations that are issued, but not yet effective,
up to the date of issuance of the consolidated financial statements are either insiginificant
or irrelevant to the Group. The Group intends to adopt these new and amended standards
and interpretations, if applicable, when they become effective. Management does not
anticipate any significant impact on future periods from the adoption of these new
amendments.
Basis of consolidation
The Consolidated Financial Statements comprise the Parent Company Ultranav International
ApS and subsidiaries in which Ultranav International ApS has control (the Group), i.e. the
power to govern the financial and operating policies so as to obtain benefits from its
activities. Control is obtained when the Company directly or indirectly holds more than 50%
of the voting rights in the subsidiary or which it, in some other way, controls.
Enterprises over which the Group exercises significant influence, but which it does not
control, are considered associates. Significant influence is generally obtained by direct or
indirect ownership or control of more than 20% of the voting rights but less than 50%.
When assessing whether Ultranav International ApS exercises control or significant influence,
potential voting rights which are exercisable at the balance sheet date are taken into account.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 29
1.1 BASIS OF REPORTING (CONTINUED)
§ GENERAL ACCOUNTING POLICIES
Basis of consolidation (continued)
The Consolidated Financial Statements has been prepared as a consolidation of the Parent
Company's and the individual subsidiaries' financial statements prepared according to the
Group accounting policies.
On consolidation, intra-group income and expenses, shareholdings, intra-group balances and
dividends, and realised and unrealised gains on intra-group transactions are eliminated.
Unrealised gains on transactions with associates are eliminated in proportion to the Group's
ownership share of the enterprise. Unrealised losses are eliminated in the same way as
unrealised gains to the extent that impairment has not taken place.
The accounting items of subsidiaries are included in full in The Consolidated Financial
Statements.
Non-controlling interests
Non-controlling interests represent the portion of profit or loss and net assets not held by
Ultranav International ApS and are presented separately in the income statement and within
equity in the consolidated balance sheet, separately from the parent shareholders’ equity.
Initially the non-controlling interest is recognised based on their share of the fair value of the
assets and liabilities acquired.
Foreign currency translation
For each of the reporting entities in the Group, a functional currency is determined. The
functional currency is the currency used in the primary financial environment in which the
reporting entity operates. Transactions denominated in other currencies than the functional
currency are foreign currency transactions.
On initial recognition, foreign currency transactions are translated to the functional currency
at the exchange rates at the transaction date. Foreign exchange differences arising between
the transaction date and at the date of payment are recognised in the income statement as
financial income or financial expenses.
Receivables and payables and other monetary items denominated in foreign currencies are
translated to the functional currency at the exchange rates at the balance sheet date.
The difference between the exchange rates at the balance sheet date and at the date at
which the receivable or payable arose or was recognised in the latest annual report is
recognised in the income statement as financial income or financial expenses.
In The Consolidated Financial Statements, the income statements of entities with another
functional currency than USD are translated at the exchange rates at the transaction date
and the balance sheet items are translated at the exchange rates at the balance sheet date.
An average exchange rate for each month is used as the transaction date exchange rate to
the extent that this does not significantly distort the presentation of the underlying
transactions.
Foreign exchange differences arising on translation of the opening balance of equity of such
foreign operations at the exchange rates at the balance sheet date and on translation of the
income statements from the exchange rates at the transaction date to the exchange rates at
the balance sheet date are recognised in other comprehensive income and presented in
equity under a separate translation reserve.
Applying materiality
The financial statements are a result of processing large numbers of transactions and
aggregating those transactions into classes according to their nature or function. When
aggregated, the transactions are presented in classes of similar items in the financial
statements. If a line item is not individually material, it is aggregated with other items of a
similar nature in the financial statements or in the notes.
There are substantial disclosure requirements throughout IFRS. Management provides
specific disclosures required by IFRS unless the information is considered immaterial to the
economic decision-making of the users of these financial statements or not applicable.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 30
1.1 BASIS OF REPORTING (CONTINUED)
§ GENERAL ACCOUNTING POLICIES
Statement of Cash Flows
The Statement of Cash Flows shows the cash flows from operating, investing and financing
activities for the year, the year's changes in cash and cash equivalents as well as cash and
cash equivalents at the beginning and end of the year.
Cash flows from operating activities are calculated according to the indirect method as the
profit/loss before tax adjusted for non-cash operating items, changes in working capital,
interest payments, dividends and income taxes paid.
Cash flows from investing activities comprise payments in connection with acquisitions and
disposals of businesses and of intangible assets, property, plant, and equipment and other
non-current assets as well as acquisition and disposal of securities not classified as cash and
cash equivalents, along with movements in restricted cash.
Cash flows from financing activities comprise changes in the share capital and related costs
as well as the raising of loans, repayment of interest-bearing debt and leases, interest
payments, acquisition and disposal of treasury shares and payment of dividends to
shareholders.
Cash and cash equivalents comprise cash and short-term marketable securities with a term
of three months or less at the acquisition date which are subject to an insignificant risk of
changes in value.
Cash flows in other currencies than the functional currency are translated using average
exchange rates unless these deviate significantly from the rate at the transaction date.
Statement of changes in equity
Dividends are recognised as a liability at the date when they are adopted at the annual
general meeting (declaration date). The proposed dividend payment for the year is disclosed
as a separate item under equity. Interim dividends are recognised as a liability at the date
when the decision to pay interim dividends is made.
The translation reserve comprises foreign exchange differences arising on translation of
financial statements of entities that have a functional currency different from USD. On full or
partial realisation of the net investment, the foreign exchange adjustments are recognised in
the income statement.
The hedging reserve comprises the cumulative net change in the fair value of hedging
transactions, and net of tax, that qualify for recognition as a cash flow hedge and where the
hedged transaction has not been realised.
Financial ratios
Financial ratios are calculated in accordance with the Recommendations and Ratios issued
by The Danish Finance Society, unless specifically stated.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 31
1.2 SIGNIFICANT ACCOUNTING JUDGMENTS AND ESTIMATES
§ ACCOUNTING POLICIES
The preparation of the Group's Consolidated Financial Statements requires management to
make judgements, estimates and assumptions that affect the reported amounts of
revenues, expenses, assets, and liabilities and the disclosure of contingent liabilities, at the
end of the reporting period. However, uncertainty about these assumptions and estimates
could result in outcomes that require a material adjustment to the carrying amounts of
asset and liability affected in future periods.
Significant judgements
In the process of applying the accounting policies, management has made the following
judgements which are considered to be significant to the Consolidated Financial
Statements:
Determination of cash-generating units of owned and leased vessels (note 3.2)
Significant estimates
Management has made the following estimates which are considered to be significant to
the Consolidated Financial Statements:
Impairment test of goodwill (note 3.1)
Assessing indicators of impairment of owned and leased vessels (note 3.2)
Measurement of non-lease components (note 5.4)
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 32
SECTION 2: PROFIT OR LOSS
2.1 Revenues
2.2 Vessel operating costs and voyage related expenses
2.3 Staff costs
2.4 Tax
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 33
2.1 REVENUES
§ ACCOUNTING POLICIES
Revenue
Revenues from freight and time-charters are recognised as the services are rendered based
the percentage of completion method. According to the method, revenues are recognised
over the period from the vessel’s load date to the delivery of the cargo (Load to Discharge).
Demurrage is included if a claim is considered probable. Losses arising from time or voyage
charter are provided for in full when they become probable.
Realised gains and losses on derivatives, which are accounted for as hedges of revenue
transactions, are recognised in revenues.
Disaggregation of revenue
As the Company is neither listed at any stock market, nor have debt or equity instruments
are traded in a public market, it has been decided not to apply IFRS 8 Operating Segments,
and not disclose any segment information.
USD thousands
2023
2022
Income from freight
1,917,105
2,390,721
Income from Time-Charter
523,016
725,954
Revenue by type of contract
2,440,121
3,116,675
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 34
2.2 VESSEL OPERATING COSTS AND VOYAGE
RELATED EXPENSES
§ ACCOUNTING POLICIES
Voyage expenses, time-charter hire and operating expenses are recognised as the services
are rendered based on the percentage of completion method. According to the method all
spot voyages and voyages servicing Contract of Affreightment (CoA) related expenses are
recognised over the period from the vessel’s load date to the delivery of the cargo (Load to
Discharge).
Expenses directly attributable to positioning the vessel to the loading port are capitalised
and expensed over the period from the vessel’s load date to the delivery of the cargo (Load
to Discharge).
Vessel operating costs and voyage related expenses comprise mainly of time charter hire,
bunker and port expenses, including realised gains or losses on bunker and FFA hedges,
which are accounted for as hedges of voyage related expenses and time charter hire.
Non-lease components of lease arrangements are described further in note 5.4 Lease
liabilities.
USD thousands
2023
2022
Bunkers
-494,839
-606,684
Other voyage related expenses
-465,338
-444,734
Voyage related expenses
-960,177
-1,051,418
Time-Charter hire, short-term leases
-807,987
-1,369,215
Operating expenses, long-term leases (non-lease component)
-120,360
-106,830
Operating expenses, own vessels
-42,902
-35,863
Time-Charter hire and operating expenses
-971,249
-1,511,908
Vessel operating costs and voyage related expenses
-1,931,426
-2,563,326
2.3 STAFF COSTS
§ ACCOUNTING POLICIES
Staff costs comprise wages and salaries, including incentives, to onshore employees.
USD thousands
2023
2022
Wages and salaries
-28,527
-40,508
Pensions – defined contribution plans
-1,216
-1,339
Other staff costs
-619
-507
Staff cost to on-shore employees
-30,362
-42,354
Staff costs
-30,362
-42,354
Average number of employees
The staff cost to onshore employees are recognised as “Staff costs” in profit or loss. Staff
cost to crew on vessels are recognised as “Vessel operating costs and voyage related
expenses”.
Remuneration of certain employees, who are remunerated by related companies, are
expensed as management fee, and consequently recognised as “Other external expenses”.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 35
2.4 TAX
§ ACCOUNTING POLICIES
Taxes
Ultranav International ApS is jointly taxed with other Danish companies in the Group, with
Ultranav International ApS (Parent Company) being the administration company for the
jointly taxed companies. The Danish corporation tax is allocated between the jointly taxed
companies in proportion to their taxable income. In relation to the shipping activities, the
companies participates in the Danish Tonnage Tax Scheme.
Companies that use tax losses in other companies pay the joint tax contribution to the
Parent Company at an amount corresponding to the tax value of the tax losses used.
Companies, whose tax losses are used by other companies, receive joint tax contributions
from the Parent Company corresponding to the tax value of the losses used (full
absorption). The jointly taxed companies are taxed under the tax prepayment scheme.
Tax for the year comprises current tax and changes in deferred tax for the year. The tax
expense relating to the profit/loss for the year is recognised in the income statement. Tax
attributable to entries directly under comprehensive income is recognised directly in other
comprehensive income.
USD thousands
2023
2022
Current tax on profit for the year
-19,120
-7,248
Deferred tax for the year
61
1,228
Tax on profit for the year
-19,059
-6,020
Adjustments related to previous years – current tax
144
149
Tax in the income statement
18,915
-5,871
Computation of effective tax rate (%):
Statutory corporate income tax in Denmark
22 %
22 %
Effects from Tonnage Tax Scheme
-2.2 %
-12.1 %
Effects of adjustments related to prior years
0.0 %
0.0 %
Deviation in foreign subsidiaries’ tax rates compared to the
Danish tax rate, net
-15.4 %
-7.9 %
Effective tax rate
4.4 %
1.9 %
Deferred tax at 31 December 2023
The deferred tax payable relates to temporary differences and amounted to USD 2.6 million
at the reporting date (2022: USD 0.6 million).
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 36
2.4 TAX (CONTINUED)
Tonnage taxation scheme and deferred tax
All significant Danish entities within the Group entered into the Danish tonnage taxation
scheme for a binding 10 year period with effect from 2017. Under the Danish tonnage
taxation scheme, taxable income is not calculated on the basis of income and expenses as
under the normal corporate taxation. Instead, taxable income is calculated with reference
to the tonnage used during the year. The taxable income for a company for a given period
is calculated as the sum of the taxable income from the activities under the tonnage
taxation scheme and the taxable income from the activities that are not covered by the
tonnage taxation scheme made up in accordance with the ordinary Danish corporate tax
system. If the participation in the Danish tonnage taxation scheme is abandoned, or if the
entities’ level of investment and activity is significant reduced, a deferred tax liability will
become payable.
For the taxable income which is made up in accordance to the ordinary corporate tax
system, a deferred tax is recognized at each period end and is accounted for using the
balance sheet liability method. Deferred tax assets, including the tax value of tax loss carry
forwards, are recognised under other non-current assets at the expected value of their
utilisation – either as a set-off against tax on future income or as a set-off against deferred
tax liabilities in the same legal tax entity and jurisdiction.
Deferred tax assets and liabilities are offset if the Company has a legally enforceable right
to set off current tax liabilities and tax assets or intends either to settle current tax liabilities
and tax assets on a net basis or to realise the assets and settle the liabilities simultaneously.
OECD Pillar Two model rules
The Group is within the scope of the OECD Pillar Two model rules. Pillar Two legislation was
enacted in Denmark, the jurisdiction in which Ultranav International ApS is incorporated,
and will come into effect from 1 January 2024. Since the Pillar Two legislation was not
effective at the reporting date, the group has no related current tax exposure. The group
applies the exception to recognising and disclosing information about deferred tax assets
and liabilities related to Pillar Two income taxes, as provided in the amendments to IAS 12
issued in May 2023.
Under the legislation, the Group is liable to pay a top-up tax for the difference between the
global effective tax rate per jurisdiction and the 15% minimum rate. However, although the
avarage effective tax rate is below 15% the Group will not be exposed to paying a significant
Pillar Two income tax as income from international shipping is excluded from the calculation
of top-up tax.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 37
SECTION 3: INVESTED CAPITAL
3.1 Intangible assets
3.2 Tangible assets & right-of-use assets
3.3 Depreciations and amortisations
3.4 Investments accounted for using the equity method
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 38
3.1 INTANGIBLE ASSETS
§ ACCOUNTING POLICIES
Intangible assets are measured at cost less accumulated amortisation and impairment
losses. Amortisation and impairment losses are included in the income statement.
Goodwill, and other intangible assets with indefinite lives are not subject to amortisation.
Those assets are instead tested annually, or upon indication, for impairment. When carrying
out the impairment test, the carrying values of CGUs are compared to the value in use
(discounted value of future cash flows). If the carrying values are higher, the difference is
charged to the income statement. The value in use is calculated using a valuation model
based on discounted expected future cash flows (DCF-model), based on management’s
projections.
Contractual rights have finite useful lives. Amortisation of contractual rights is recognised
in the income statement based on the period to which the contracts relate. The contractual
rights are amortised over a period of up to 10 years. Amortisation methods, useful lives and
residual values are reviewed at each reporting date and adjusted if appropriate. Intangible
assets with finite lives are tested for impairment upon indication.
2023
USD thousands
Customers
Relations
Goodwill
Contractual
Rights
Total
Costs as of 1 January, accumulated
-
-
57,453
57,453
Additions through business combinations
1,208
11,348
-
12,556
Cost at 31 December, accumulated
1,208
11,348
57,453
70,009
Amortisations at 1 January, accumulated
-
-
-56,597
-56,597
Amortisation
-201
-
-856
-1,057
Amortisation at 31 December,
accumulated
-201
-
-57,453
-57,654
Carrying amount 31 December
1,007
11,348
-
12,355
2022
USD thousands
Goodwill
Contractual
Rights
Total
Costs as of 1 January, accumulated
35,172
57,453
92,625
Cost at 31 December, accumulated
35,172
57,453
92,625
Amortisations at 1 January,
accumulated
-
-55,105
-55,105
Impairment charge
-35,172
-
-35,172
Amortisation
-
-1,492
-1,492
Amortisation at 31 December,
accumulated
-35,172
-56,597
-91,769
Carrying amount 31 December
-
856
856
The entire carrying value of goodwill is related to the Group’s Peruvian towage operations
which were acquired in February 2023 through the acquisition of Petrolera Transoceánica
S.A. (reference is made to note 3.5).
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 39
3.2 TANGIBLE ASSETS & RIGHT-OF-USE ASSETS
§ ACCOUNTING POLICIES
Tangible assets
Tangible assets are measured at cost less accumulated depreciation and impairment losses.
Cost comprises the purchase price and any costs directly attributable to the acquisition until
the date when the asset is available for use. Instalments and costs incurred during the
construction period on new building contracts are capitalised as they are paid. Borrowing
costs (interest) that are attributable to the construction of the vessels are capitalised and
included as part of the cost. The capitalised value is reclassified from new buildings to vessels
upon delivery from the yard.
Where individual components of an item of tangible assets have different useful lives, they
are depreciated separately. Depreciation is provided on a straight-line basis over the
expected useful lives of the assets/components. The expected useful lives are as follows:
• Vessels: 20 – 25 years
• Fixtures, fittings and equipment: 2 – 10 years
Dry docking costs are recognised in the carrying amount of vessels when incurred and
depreciated over the period until the next dry docking.
Depreciation is calculated on the basis of the residual value and impairment losses, if any.
The useful life and residual value are determined at the acquisition date and reassessed
annually. If the residual value exceeds the carrying amount, depreciation is discontinued, The
residual value of the vessels is estimated as the lightweight tonnage of each vessel multiplied
by scrap value per ton.
When changing the depreciation period or the residual value, the effect on the depreciation
is recognised prospectively as a change in accounting estimates.
The carrying values of vessels and new buildings are reviewed for impairments when events
or changes in circumstances indicate that the carrying value may not be recoverable.
Valuations are performed frequently to ensure that the fair value of the asset does not differ
materially from its carrying amount.
Right-of-use assets
Right-of-use assets primarily consist of leased vessels.
Ultranav International ApS recognises right-of-use assets at the commencement date of the
lease (i.e. the date the underlying asset is available for use). Right-of-use assets are measured
at cost, less any accumulated depreciation and impairment losses, and adjusted for any
remeasurement of lease liabilities.
The cost of right-of-use assets includes the amount of lease liabilities recognised, and lease
payments made before the commencement date.
Unless the Group is reasonably certain to obtain ownership of the leased asset at the end of
the lease term, the recognised right-of-use assets are depreciated on a straight-line basis
over the shorter of its estimated useful life and the lease term.
Right-of-use assets are subject to testing for impairment if there is an indicator of
impairment, as for owned assets.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 40
3.2 TANGIBLE ASSETS & RIGHT-OF-USE ASSETS (CONTINUED)
§ ACCOUNTING POLICIES
Impairment of tangible assets
The carrying amount of non-current assets is reviewed annually for indicators of
impairment. When there is an indication that assets may be impaired, the recoverable
amount of the asset is determined.
The recoverable amount is the higher of an asset’s fair value less expected costs to sell and
its value in use. Value in use is the present value of the future cash flows expected to be
derived from an asset or the cash-generating unit to which the asset belongs. An
impairment loss is recognised if the carrying amount of an asset or a cash-generating unit,
respectively, exceeds the recoverable amount of the asset or the cash-generating unit.
Impairment losses are recognised in the income statement in a separate line item.
Impairment is reversed only to the extent of changes in the assumptions and estimates
underlying the impairment calculation. Impairment is only reversed to the extent that the
asset’s increased carrying amount does not exceed the carrying amount that would have
been determined (net of amortisation or depreciation) had no impairment loss been
recognised for the asset in prior years.
! ACCOUNTING JUDGEMENTS
DETERMINING CGU
Management’s assessment of indicators of impairment on right-of-use assets (vessels) is
based on the cash-generating units in which assets are included. The identification of such
cash‑generating units involves significant judgement.
Management has concluded that the fleet of dry bulk vessels (owned and leased) comprise
one cash generating units, where the vessels are managed on a portfolio basis and
considered to be interchangeable.
Further, Management has concluded that the fleets of tankers comprise three cash
generating unit delineated individually, where the vessels are managed on portfolio basis
and considered to be interchangeable.
Lastly, Management has concluded that the fleet of tugboats comprise one cash generating
unit, where the vessels are managed on a portfolio basis and considered interchangeable.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 41
3.2 TANGIBLE ASSETS & RIGHT-OF-USE ASSETS (CONTINUED)
! ACCOUNTING ESTIMATES
ASSESSING INDICATIONS OF IMPAIRMENT
Management’s assessment of whether there is any indication that an asset, or a CGU, may
be impaired comprise, among other things, financial performance, broker values,
newbuilding prices, and freight and time charter rates. This assessment involves significant
judgment.
From a historical perspective, the dry bulk market has generally remained strong in 2023,
albeit with increased volatility. There have been more rapid shifts in spot and future freight
rates from week to week and even day to day compared to what has previously been seen.
However, simultaneously, the average rates have remained profitable. This development is
something, which is expected to persist moving forward.
2023 saw positive tanker fundamentals, with oil demand improving. Inflationary pressures
worldwide and subsequent interest rate increases did not bring economies into recessions,
initially feared. COVID mobility restrictions were suspended in most parts of the world,
including China, giving support to oil demand. On top, the geopolitical tensions and the
Panama Canal reduced transits are creating an increase in ton-miles demand that has given
additional support to the tanker rates.
Macro-economic and political factors add a general uncertainty and volatility to freight
rates linked to, but not limited to, the Ukraine/Russia war, the conflict in the Middle East,
trade tensions between the United States and China, development in inflation rates and the
slowing economic growth.
On the other hand, a low newbuilding orderbook for dry cargo carriers and tankers does
indicate generally healthy market fundamentals, which are expected to keep long- and
medium-term freight rates at a sustainable level. Consequently, the expected long- and
medium-term freight rates are expected to continue to generate positive free cash flow
supporting the carrying amount of the right-of-use vessels. As such, no indications of need
for impairments were identified for the Group’s tangible assets and right-of-use vessels.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 42
3.2 TANGIBLE ASSETS & RIGHT-OF-USE ASSETS (CONTINUED)
2023
USD thousands
Vessels
Fixtures,
fittings and
equipment
Right-of-use
assets
Total
Costs as of 1 January, accumulated
280,268
4,049
773,287
1,057,604
Additions
47,128
2,832
227,662
277,662
Disposals
-123,353
-33
-211,318
-334,704
Remeasurement
-
-
12,177
12,177
Additions through business
combinations
71,994
-
-
71,994
Cost at 31 December, accumulated
276,037
6,848
801,808
1,084,693
Q
Depreciation and impairments at
1 January, accumulated
-76,603
-2,722
-476,068
-555,393
Depreciations
-29,395
-1,245
-168,054
-198,694
Depreciations on disposals
42,590
27
160,245
202,862
Depreciations through business
combinations
-37,766
-
-
-37,766
Depreciation and impairment at
31 December, accumulated
-101,174
-3,940
-483,877
-588,991
Carrying amount 31 December
174,863
2,908
317,931
495,702
2022
USD thousands
Vessels
Fixtures,
fittings and
equipment
Right-of-use
assets
Total
Costs as of 1 January, accumulated
232,204
6,931
795,700
1,034,835
Additions
100,403
1,472
197,646
299,521
Disposals
-52,339
-4,354
-204,160
-260,853
Remeasurement
-
-
-15,899
-15,899
Cost at 31 December, accumulated
280,268
4,049
773,287
1,057,604
Q
Depreciation and impairments at
1 January, accumulated
-56,160
-5,972
-512,257
-574,389
Depreciations
-23,442
-1,104
-151,498
-176,044
Depreciations on disposals
2,999
4,354
187,687
195,040
Depreciation and impairment at
31 December, accumulated
-76,603
-2,722
-476,068
-555,393
Carrying amount 31 December
203,665
1,327
297,219
502,211
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 43
3.3 DEPRECIATIONS AND AMORTISATIONS
§ ACCOUNTING POLICIES
For accounting policies related to depreciations, reference is made to note 3.2 Tangible
assets.
USD thousands
2023
2022
Depreciations on owned vessels
-29,395
-23,442
Depreciations on right-of-use assets
-168,054
-151,498
Depreciations on fixture, fittings, and equipment
-1,245
-1,104
Amortisations on customers relations and contractual rights
-1,057
-1,486
Depreciations and amortisations for the year
-199,751
-177,530
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 44
3.4 INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
§ ACCOUNTING POLICIES
Investments in associates are recognised in The Consolidated Financial Statements
according to the equity method. Investments in associates are measured at the
proportionate share of the enterprises' net asset values calculated in accordance with the
Group's accounting policies minus or plus the proportionate share of unrealised intra-group
profits and losses and plus additional value on acquisition, including goodwill.
Investments in associates are tested for impairment when impairment indicators are
identified.
Investments in associates with negative net asset values are measured at USD 0 (nil). If the
Group has a legal or constructive obligation to cover a deficit in the associate, the remaining
amount is recognised under provisions. Amounts owed by associates are measured at
amortised cost. Write-down is made for bad debt losses.
The proportionate share of the result after tax of associates is recognized in the
consolidated income statement after elimination of the proportionate share of intra-group
profits/losses.
Undertakings which are contractually operated jointly with another counterparty (joint
ventures) and thus are jointly controlled are recognised in The Consolidated Financial
Statements according to the equity method. Investments in joint ventures are measured at
the proportionate share of the enterprises' net asset values calculated in accordance with
the Group's accounting policies minus or plus the proportionate share of unrealised intra-
group profits and losses and plus additional value on acquisition, including goodwill.
Investments in joint ventures are tested for impairment when impairment indicators are
identified.Investments in joint ventures with negative net asset values are measured at USD
0 (nil). If the Group has a legal or constructive obligation to cover a deficit in the joint
ventures, the remaining amount is recognised under provisions.
Amounts owed by joint ventures are measured at amortised cost. Write-down is made for
bad debt losses. The proportionate share of the result after tax of the joint ventures is
recognized in the consolidated income statement after elimination of the proportionate
share of intra-group profit/losses.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 45
3.4 INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD (CONT.)
2023
USD thousands
Navigator
Holdings Ltd.
Other
investments
Total
Cost at 1 January
220,416
79,949
300,365
Additions
-
6,823
6,823
Cost at 31 December
220,416
86,772
307,188
Value adjustment at 1 January,
accumulated
12,235
1,177
13,412
Share of the result for the year
30,928
16,421
47,349
Dividends
-2,120
-11,474
-13,594
Other increase/(decrease)
-
-11,112
-11,112
Value adjustment at 31 December,
accumulated
41,043
-4,988
36,055
Carrying amount at 31 December
261,459
81,784
343,243
2022
USD thousands
Navigator
Holdings Ltd.
Other
investments
Total
Cost at 1 January
220,416
72,016
292,432
Additions
-
7,933
7,933
Cost at 31 December
220,416
79,949
300,365
Value adjustment at 1 January,
accumulated
-8,846
12,358
3,512
Share of the result for the year
21,611
-1,191
20,420
Dividends
-
-800
-800
Other increase (decrease)
-530
-9,190
-9,720
Value adjustment at 31 December,
accumulated
12,235
1,177
13,412
Carrying amount at 31 December
232,651
81,126
313,777
Navigator Holdings Ltd.
Ultranav International ApS owns 29.0% of the shares in Navigator Holdings Ltd., an
owner and operator of the world’s largest fleet of handysize liquefied gas carriers.
The shares of Navigator Holdings Ltd are listed on the New Your Stock Exchange.
The share price at the reporting date was USD 14.55 resulting in a market valuation
of the investment at USD 308 million against a book value of USD 261 million.
The summarized financial information below is adjusted for allocation of
difference between purchase price and book value at the acquisition date
(purchase price allocation).
Summarised financial information
Navigator Holdings Ltd.
USD millions
2023
2022
Revenues
550,7
473.8
Profit or loss
106.8
78.3
Other comprehensive income
0.3
-0.2
Total comprehensive income
107.1
78.1
Current assets
255.4
228.3
Non-current assets
1,660.0
1.548.7
Current liabilities
185.4
270.6
Non-current liabilities
784.2
652.7
Net assets
945.6
853.7
Non-controlling interest
42.8
10.9
Equity attributable to shareholders
902.8
842.8
Ownership % at closing date
29.0%
27.6%
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 46
3.5 BUSINESS COMBINATION
Acquisition of Petrolera Transoceánica S.A., Peru
On 28th February 2023, the Group completed a share purchase transaction in which the
Group obtained 99.75% ownership of Petrolera Transoceánica S.A. (“Petranso”). The
objective of the transaction was to increase the Group’s participation in the Peruvian
operation and reach a controlling interest.
Prior to the transaction date, the Group owned 50% of shares and voting rights in Petranso.
Hence the investment was measured and presented in accordance with the equity method
applied for investments in associates and joint ventures, cf. note 3.5. The gain from
remeasurement of the equity interest at the combination date was USD 8,747 thousands
and is recognised in profit or loss through Gain/(loss) from disposal of associates.
The Group obtained a controlling interest on the transaction data and Petranso is in its
consolidated financials from that point onwards. The impact from the combination on net
profit in 2023 was USD 2.2 million. Had the transaction occurred on 1 January 2023, the
proforma impact on net profit would be USD 2.6 million.
Net assets acquired, including non-controlling interests’ share of these, are measured at fair
value at the acquisition-date. Goodwill arising from the combination relates to the synergies
expected obtaining a controlling interest in the Peruvian operations which complements
the Group’s existing operations in a number of ports in South America. The fair value
estimation of property, ships and equipment were based on the cost approach in which the
value is assessed by the cost of reproduction or substitution by another comparable asset.
The fair value of intangible assets, which comprise mainly of customer relations, were
evaluated using the Multi-Period Excess Earnings Method.
Working capital comprise receivables of USD 9.5 million at contractual amounts and are
included at a fair value of USD 9.4 million. The difference between the gross amount and
fair value comprise mainly of those contractual cash flows which are not expected be
collected. Receivables consist mainly of trade receivables and is therefore not presented by
other classes of receivables.
The Group did not incur material acquisition-related expenses as the combination did not
require a comprehensive due diligence as the Group exercised significant influence over the
acquiree already prior to the transaction.
The table below comprise the fair value of net identifiable assets at the transaction date:
USD thousands
Intangible assets, including software and customer relations
1,385
Property, ships and equipment
35,909
Working capital, net
5,146
Other net assets
130
Deferred tax assets
-3,412
Net financial debt
-4,846
Fair value of net identifiable assets acquired
34,312
Goodwill
11,348
Fair value of net identifiable assets acquired including goodwill
45,660
Non-controlling interests
-950
Fair value of equity interests acquired
44,710
§ ACCOUNTING POLICIES
Business combinations are, unless they constitute combinations of entities under common
control, accounted for using the acquisition method.
The consideration paid comprises the fair values of any assets transferred and/or liabilities
incurred to the former owners, including contingent consideration arrangements.
Identifiable assets and liabilities, including any contingent liabilities assumed, are measured
at fair value at the date of acquisition.
Goodwill is recognised as the excess of the consideration paid over the fair value of net
identifiable assets. Acquisition-related costs are expensed in profit or loss when incurred.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 47
3.5 BUSINESS COMBINATION (CONTINUED)
Acquisition of Otway Green Energy Project
On the 5th of January 2024, the Group completed a share purchase transaction in which
the Group obtained 100% ownership of Otway Green Energy at the price of USD 110 million.
The objective of the transaction is to purchase port facilities and participation in the
development of green ammonia production projects in Chile with the purpose to develop
the future fuels for shipping.
Through the transaction completed on 5th January 2024, the Group obtained a controlling
interest and will thus include the financial statements of Otway Green Energy in the
consolidated financials from the acquisition date and onwards. The transaction does not
impact the Consolidated Financial Statements reported at 31st December 2023 as the
transaction occurred after the reporting date.
Due to the short time between the transaction date and finalisation of the Annual Report
2023, the Group had not yet completed the accounting for the business combination. For
this reason, certain disclosures required for business combinations occurring after the
reporting date, but before the financial statements are authorised for issue, have not been
included. The omitted disclosures comprise the amounts to be recognised for each major
class of assets and liabilities acquired, contingent liabilities, description of factors that make
up any goodwill recognised and detailed information of trade receivables.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 48
SECTION 4: WORKING CAPITAL
4.1 RECEIVABLES AND PREPAYMENTS
4.2 INVENTORIES
4.3 RESTRICTED CASH
4.4 TRADE AND OTHER PAYABLES
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 49
4.1 RECEIVABLES AND PREPAYMENTS
§ ACCOUNTING POLICIES
Receivables
Receivables are measured at amortised cost less provisions for impairment losses. The
Group applies the simplified approach to providing the expected credit losses prescribed by
IFRS 9, which permits the use of the lifetime expected loss provision for trade receivables.
To measure the expected credit losses trade receivables have been grouped based on credit
risks and the day past due. In accordance with IFRS 9, non-due trade receivables have also
been impaired.
For a description of the Group’s payment terms as well as management of credit risk,
reference is made to note 5.5 Financial risks.
Contract assets
Contract assets include accrued revenue for voyages that are not completed at 31
December, and which were not yet invoiced or prepaid at that date. Contract assets are
recognised when a sales transaction fulfils the criteria for revenue recognition but no final
invoice has yet been issued to the customer for the services delivered.
Prepayments
Prepayments comprise cost incurred in relation to subsequent financial years.
Trade receivables
In the shipping industry, it is standard terms that freight payments are made within few
days of departing from the loading port and time charter payments are even paid in
advance. It is also standard terms that the vessel owner, or disponent owner, has a lien in
the cargo, should the freight payment not have been made prior to arriving at the discharge
port. The credit risk on trade receivables is therefore generally low.
Loans to related companies
Loans to related companies comprise of interest-bearing intragroup loans to a related
company outside the Ultranav International ApS Group. The loans are entered with a fixed
margin of 1.83% – 2.20% + SOFR6M. Management considers the credit risk to be low.
USD thousands
2023
2022
Customers (trade receivables)
79,740
137,304
Contract assets
63,952
61,348
Other receivables
37,891
36,305
Trade and other receivables
181,583
234,957
Receivables from related companies
112,501
73,839
Loans to related companies
335,683
271,087
Loans and receivables, related companies
448,184
344,926
Prepayments
76,499
64,812
Prepayments
76,499
64,812
- Receivables not due
43,050
69,207
- Less than 90 days
33,301
64,334
- Between 91 days and 180 days
3,551
6,194
- Between 181 days and 360 days
2,933
5,639
- More than 360 days
3,149
1,115
Carrying amount of trade receivables excluding provisions
85,984
146,489
Provisions at 31 December
-6,244
-9,185
Carrying amount of trade receivables
79,740
137,304
Provision at 1 January
9,185
6,071
Net change in provision
-2,941
3,114
Provision 31 December
6,244
9,185
Trade receivables are non-interest bearing and are generally due within 5 – 90 days.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 50
4.2 INVENTORIES
§ ACCOUNTING POLICIES
Inventories are valued at the lower of cost and net realisable value. Cost is determined on
a first-in, first-out (FIFO) basis. The net realisable value is the estimated selling price in the
ordinary course of business, less applicable variable selling expenses. Costs of bunkers
include the transfer from equity to profit and loss on qualifying cash flow hedges.
USD thousands
2023
2022
Bunkers
54,149
59,178
Inventories
54,149
59,178
Bunker expenses recognised in profit and loss
494,839
606,684
A part of the future bunker consumption has been hedged through derivatives in
accordance with the Group’s risk management policy. This is further described in note 5.5
Risks arising from financial instruments.
4.3 RESTRICTED CASH
§ ACCOUNTING POLICIES
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand, short-
term deposits with an original maturity of three months or less, and cash balances which
are restricted.
USD thousands
2023
2022
Cash and cash equivalents
535,061
393,505
Restricted cash in the form of deposits with clearing houses
13,139
16,808
Cash and cash equivalents, including restricted cash
548,200
410,313
The Group trades derivative financial instruments through clearing houses. In that
connection, the Group has established margin accounts with those clearing houses on
which cash is deposited as security.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 51
4.4 TRADE AND OTHER PAYABLES
§ ACCOUNTING POLICIES
Trade and other payables
Trade payables, payables to related parties, and other payables are measured at amortised
cost.
Contract liabilities
Contract liabilities relate to voyages which are not completed at 31 December. Contract
liabilities are recognised when a sales transaction does not fulfil the criteria for revenue
recognition but the customer has prepaid for the service delivery. If contract liabilities are
beyond one year the contract assets are included in non-current liabilities.
USD thousands
2023
2022
Funds received from pool members
-
5,500
Other payables, non-current
-
5,500
Trade payables
95,271
127,268
Accruals and other payables
73,561
86,617
Contract liabilities
42,413
54,446
Trade and other payables, current
211,245
268,331
Payables to related companies
27,426
16,123
Loans payable to related companies
-
10,229
Payables to related companies, current
27,426
26,352
The contract liability balance at the beginning of the year was recognised as revenue during
the reporting period. Outstanding performance obligations will be performed within one
year.
Trade payables are non-interest bearing and are normally settled on 30 days terms. Other
payables, including accrued expenses, are non-interest bearing and vary in payment terms.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 52
SECTION 5: CAPITAL STRUCTURE
5.1 FINANCIAL ITEMS
5.2 SECURITIES
5.3 INTEREST BEARING LOANS AND BORROWINGS
5.4 LEASE LIABILITIES
5.5 RISKS ARISING FROM FINANCIAL INSTRUMENTS
5.6 FINANCIAL INSTRUMENTS
5.7 DERIVATIVE FINANCIAL INSTRUMENTS
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 53
5.1 FINANCIAL ITEMS
§ ACCOUNTING POLICIES
Financial income and expenses comprise interest income and expense as well as exchange
rate differences from transactions denominated in foreign currencies.
USD thousands
2023
2022
Interest income
27,572
6,466
Interest income, loans to related parties
23,038
5,794
Gain from modification of lease liabilities
1,092
1,211
Financial income
51,702
13,471
-
Interest expenses, bank loans and overdrafts
-20,003
-10,778
Interest expenses, loans from related parties
-430
-3,060
Interest expenses, lease liabilities
-13,071
-10,323
Other financial items, net
-1,273
-2,118
Financial expenses
-34,777
-26,279
5.2 OTHER FINANCIAL ASSETS
§ ACCOUNTING POLICIES
Other financial asset comprise of shares and bonds, which are recognised on the trading
date at fair value and subsequently measured at the quoted market price for the listed
securities, as well as other financial assets that are recognised at amortized cost. Value
adjustments related to other financial assets classified as current assets are recognised in
the income statement under financial items. Value adjustments related to other financial
items classified as non-current assets are recognised in other comprehensive income.
USD thousands
2023
2022
Bonds
80,001
-
Shares
7,863
-
Other financial assets, net
-
7,106
Other financial assets
87,864
7,106
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 54
5.3 INTEREST BEARING LOANS AND
BORROWINGS
§ ACCOUNTING POLICIES
Loans are recognised at the time the loans are obtained in the amount of the proceeds after
deduction of transaction costs. In subsequent periods, the loans are recognised at
amortised costs.
Carrying amount
USD thousands
Type
2023
2022
Interest bearing loans
Fixed
40,666
37,898
Interest bearing loans
Floating
248,658
237,839
Interest bearing loans and borrowings
289,324
275,737
Non-current portion
271,623
268,387
Current portion
17,701
7,350
Interest bearing loans and borrowings
289,324
275,737
The fixed-rate loans are fixed at an interest rate of 3.15% - 3.20% (2022: 3.15% - 3.20%).
The floating-rate loans are based upon the USDLIBOR and SOFR6M with an additional
margin of 1.95% - 2.65% (2022: 1.80% - 2.65%). The interest rate on the floating rate
interest bearing loan was between 7.25% - 8.15% (2022: 3.25% - 5.20%).
The fair value of the fixed loans is not materially different from the carrying amount.
The loans are subject to financial and operational covenants, including a minimum equity.
Management assesses that Ultranav International ApS and the related company guarantor
meet these covenants at the closing date as well as throughout the financial year.
Fixed loans are partly secured by vessels. The carrying amount of the vessels provided as
security is USD 57.8 million (2022: USD 62.5 million).
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 55
5.4 LEASE LIABILITIES
§ ACCOUNTING POLICIES
Lease liabilities
At the commencement date of the lease, the Group recognises a lease liability which is
measured at the present value of lease payments to be made over the lease term. The
service fee included in the payments (non-lease component) is not included as part of the
lease liabilities.
The lease term comprises the non-cancellable period with addition of periods covered by
options to extend the lease if it is reasonably certain that the extension option will be
exercised. This assessment is made on inception of the lease.
The lease payments include fixed payments and variable payments depending on an index
or a rate. The lease payments do also include the exercise price of a purchase option if it is
reasonably certain that it will be exercised.
In calculating the present value of lease payments, Ultranav International ApS uses the
incremental borrowing rate at the lease commencement date. After the commencement
date, the amount of lease liabilities is increased to reflect the accretion of interest and
reduced for the lease payments made.
In addition, the carrying amount of lease liabilities is remeasured if there is a modification,
a change in the lease term, a change in the fixed lease payments or a change in the
assessment to purchase the underlying asset.
Lease contracts for vessels have been entered into with a mutually interminable lease
period. As a general rule, lease contracts include an option to renew for one additional year
at a time for up to three years.
Some lease contracts include customary option for extension of the lease period. The
liability concerning the extension period is only included in lease liabilities if it is reasonably
certain the extension period will be exercised.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 56
5.4 LEASE LIABILITIES (CONTINUED)
The development in lease liabilities is explained in the table below:
USD thousands
2023
2022
Lease liabilities 1 January
311,239
310,121
Additions for the period
227,661
224,086
Remeasurements
-40,945
-36,609
Instalments made
-169,819
-161,312
Disposals
-
-25,047
Lease liabilities 31 December
328,136
311,239
Non-current portion
124,378
129,708
Current portion
203,758
181,531
Lease liabilities 31 December
328,136
311,239
Of the total lease liabilities, USD 44 million (2022: USD 12 million) is related to flexible hire
lease contracts. The flexible hire is based upon the Baltic Exchange index and a change in
the index of 10% will result in a 10% increase in the hire payment for flexible lease hire
contracts.
Leases to which the Group is committed, but for which lease terms have not yet
commenced have an undiscounted value of USD 129 million (2022: USD 124.5 million).
The total cash outflow from leases in 2023 was USD 1,102 million (2022: USD 1,679.6
million) which includes short term leases.
Some lease agreements include a purchase option which is typically exercisable as from the
end of the fifth year to the expiry of the period of renewal. Some of the purchase options
are, however, shared with third parties which limits the potential gain from exercising such
purchase options.
! ACCOUNTING ESTIMATES
Measurement of non-lease components
The Group has chosen to separate lease and non-lease components for leases of time
charter contracts on vessels. For these contracts, the estimated non-lease component
(operating expenses) is excluded from the measurement of right-of-use assets and lease
liabilities. Assessing the measurement of the non-lease component involves significant
estimates. The measurement of the non-lease component takes several factors into
consideration such as operating costs, aging of the vessels, vessel types, etc.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 57
5.5 RISKS ARISING FROM FINANCIAL INSTRUMENTS
Through the Group’s shipping activities, the Group is exposed to a number of risks arising from financial instruments, which the overall management programme focuses on minimising.
Credit Risk
The Group is exposed to credit risk in various ways, however mainly in relation to trade
receivables from customers, prepaid time-charter hire, cash deposits with financial
institutions and the settlement receivables from derivative instruments (namely FFAs and
bunker hedges).
The credit risk of receivables from trade and derivative instruments, along with prepaid
time charter hire, is reduced through systematic credit assessment of each counterparty
and by monitoring their creditworthiness. With respect to FFAs, those instruments are
generally entered with international clearing houses. Similarly, cash at banks is deposited
with international financial institutions with solid credit ratings.
Liquidity Risk
The Group’s strategy is to maintain a solid cash balance that is sufficient to cover cash flows
even through a period of volatile or stressed markets. Cash flows are closely monitored to
evaluate the current cash position.
Derivative instruments
The Group is utilising derivatives to cover exposures in freight rates, bunker prices, and
currencies. The cash flow from derivative contracts are subject to changes in market prices,
to which the derivatives are linked. The Group is monitoring the effectiveness of the
derivatives as hedging instruments to compare if changes in cash flow match the underlying
exposure which they are meant to cover.
Market Risk
The Group’s market risk relates to its currency risk and interest risk.
Interest rate risk
The financing structure of the Group is based partly on floating rate loans. Consequently,
the Group is exposed to fluctuations in USDLIBOR and SOFR6M. The Group has extended
loans on similar terms and amounts to related companies which partly offsets the risk
arising for fluctuating interest rates. The residual risk is continuously monitored by
management.
Currency risk
The global operations of the Group expose it to a currency risk, particularly attached to
cash, receivables and payables in other currencies that USD, mainly DKK and EUR. The
currency risk is not deemed significant as these balances make up only a minor portion of
the Group’s financial instruments.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 58
5.6 FINANCIAL INSTRUMENTS BY CATEGORY
Carrying amount and fair value of financial items by class of
financial assets and liabilities
On the next page is a breakdown of the financial assets into categories as defined in IFRS 9.
The fair value is estimated using appropriate market information and valuation
methodologies. The carrying amount of cash and cash equivalents and loan payables to
bank are a reasonable estimate of their fair value.
Fair value for derivatives and borrowings has been calculated by discounting the expected
future cash flows at relevant interest rates. Judgement is required to develop estimates of
fair value. Hence, the estimates provided herein are only indicative of the amounts that
could be realised in the market.
The contractual cash flows are non-discounted and include all liabilities according to
contracts. The USD values of future interests and principal loans in foreign currencies are
calculated based on the rates at the balance sheet date.
Categories of financial instruments
The fair value of financial assets and financial liabilities measured at amortized cost is
approximately equal to the carrying amount.
Financial instruments measured at fair value are divided in accordance with the following
accounting hierarchy:
- Level 1: observable market prices of identical instruments.
- Level 2: valuation models primarily based on observable prices or trading prices of
comparable instruments
- Level 3: valuation models primarily based on non-observable prices.
Other financial assets: the fair value of shares and bonds are considered fair value
measurement at level 1 as the fair value is based on observable market prices of identical
instruments.
Derivative financial instruments: the fair value of all derivative financial instruments,
forward exchange contracts and other derivative financial instruments (commodity
instruments), is considered fair value measurement at level 2 as the fair value is based on
observable pricing information.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 59
5.6 FINANCIAL INSTRUMENTS BY CATEGORY (CONTINUED)
Tables with carrying amounts of financial items by class of financial assets and liabilities
USD thousands
December 31
st
2023
December 31
st
2022
0-1 Year
1-5 Years
Contractual
cash flow
Carrying
amount
0-1 Year
1-5 Years
Contractual
cash flow
Carrying
amount
Recognised at amortised cost
Loans from financial institutions
23,620
301,904
325,524
289,324
19,419
319,477
338,896
275,737
Payable to- and loans from related companies
27,462
-
27,462
27,426
26,742
-
26,742
26,742
Trade and other payables
211,245
-
211,245
211,245
267,895
5,500
273,395
273,395
Lease liabilities
243,950
89,659
333,609
328,136
184,788
133,488
318,276
311,239
Total
506,277
391,563
897,840
856,131
498,844
458,465
957,309
887,113
Recognised at fair value
Derivative financial instruments
15,088
3,689
18,777
18,777
3,702
865
4,567
4,567
Total
15,088
3,689
18,777
18,777
3,702
865
4,567
4,567
Total financial liabilities
521,365
395,251
916,617
874,944
502,546
459,330
961,876
891,680
Recognised at amortised cost
Cash and restricted cash
548,200
-
548,200
548,200
410,313
-
410,313
410,313
Trade and other receivables
181,583
-
181,583
181,583
234,957
8,654
243,611
243,611
Receivables from- and loans to related companies
430,291
24,750
455,041
448,184
235,845
115,511
351,356
337,571
Total
1,160,074
24,750
1,184,824
1,177,967
881,115
124,165
1,005,280
991,495
Recognised at fair value
Derivative financial instruments
25,468
3,756
29,224
29,224
3,089
2,114
5,203
5,203
Total
25,468
3,756
29,224
29,224
3,089
2,114
5,203
5,203
Total financial assets
1,185,542
28,506
1,214,047
1,207,191
884,204
126,279
1,010,483
996,698
Contractual cash flow arising from financial guarantee contracts are disclosed in note 6.3 to the Consolidated Financial Statements.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 60
5.7 DERIVATIVE FINANCIAL INSTRUMENTS
§ ACCOUNTING POLICIES
The Group uses derivative financial instruments such as forward currency contracts, bunker
hedges and FFAs to hedge part of risks. Such derivative financial instruments are initially
recognized at fair value on the date on which a derivate contract is entered into and are
subsequently re-measured at fair value. Derivatives are carried as assets when the fair value
is positive and as liabilities when the fair value is negative. Any gains or losses arising from
changes in fair value on derivatives that do not qualify for hedge accounting are taken
directly to profit or loss.
The fair value of forward currency contracts is calculated by reference to current forward
exchange rates for contracts with similar maturity profiles. The fair value of bunker hedge
and the fair value of FFAs are determined by reference to market values for similar
instruments.
For the purpose of accounting, hedges are classified as:
• fair value hedges when hedging the exposure to change in fair value of a recognised
asset or liability or an unrecognised firm commitment (except for foreign currency risk);
or
• cash flow hedge when hedging exposure to variability in cash flow that is either
attributable to a particular risk associated with a recognised asset or liability or a highly
probable forecast transaction or the foreign currency risk in an unrecognised firm
commitment.
At time of entering into a hedge relationship, the Group designates and documents the
hedge relationship to which the Group wishes to apply for hedge accounting and the risk
management objectives and strategy for undertaking the hedge. The documentation
includes identification of the hedging instrument, the hedged item or transaction, the
nature of the risk being hedged and how the entity will assess the hedging instrument’s
effectiveness requirements.
The criteria for classifying a derivative as a hedging instrument for accounting purposes are
as follows:
• there is an economic relationship between the hedged item and the hedging instrument
• the effect of credit risk does not dominate the value changes that result from the
economic relationship
• the hedge ratio of the hedging relationship is the same as that resulting from the
quantity of the hedged items that the entity actually hedges and the quantity of the
hedging instrument that the entity actually uses to hedge that quantity of hedged item.
Hedges which meet the criteria for hedge accounting are accounted for as follows:
Fair value hedges
Derivatives designated as hedging instruments are measured at fair value and changes in
fair value are recognised in the income statement. Correspondingly, a change in the fair
value of the hedged item attributable to the hedged risk is recognised in the income
statement. The fair value hedge accounting is discontinued if the hedging instrument
expires or is sold, terminated or exercised, or the hedge no longer meets the criteria for
hedge accounting stated above.
Cash flow hedges
Changes in the fair value of a hedging instrument that meet the criteria for cash flow hedge
accounting are recognized in other comprehensive income. The ineffective part of the
hedging instrument is recognised directly in the income statement. Gains and losses that
are recognised in other comprehensive income are taken to the income statement in the
same period or periods as the cash flow which comprises the hedged item is recognised in
the income statement. The principle also applies if the hedged forecasted transaction
results in an asset or liability being recognised in the balance sheet. If the cash flow hedge
no longer meets the criteria for hedge accounting, hedge accounting is discontinued. The
cumulative gain or loss of the hedging instrument recognised in other comprehensive
income remains separately recognised in other comprehensive income until the forecast
transaction occurs. If the cash flow hedged transaction is no longer expected to occur, any
previously accumulated gain or loss of the hedging instrument that has been recognised in
other comprehensive income will be carried to profit or loss. Derivatives not accounted for
as hedging instruments are classified as financial assets at fair value through profit or loss
and measured at fair value.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 61
5.7 DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)
§ ACCOUNTING POLICIES (CONT.)
Economic trading & economic hedging
Derivative financial instruments, which are not deignated as cash flow hedges, are
categorized as either economic trading or economic hedging. These derivatives do not meet
the criteria for hedge accounting. Gains and losses, realised or unrealised, from derivatives
used for economic trading or economic hedging are recognised in the income statement.
Determination of fair value
The fair value of financial assets and liabilities is measured on the basis of quoted market
prices of financial instruments traded in an active market. If an active market exists, fair
value is based on the most recent observed market price at the end of the reporting period.
If an active market does not exist, the fair value is measured according to generally accepted
valuation techniques. Market-based parameters are used to measure fair value.
For bunker contracts the price is based on the prices from Platts Bunkerwire. The value of
FFAs is assessed on basis of daily recorded prices from the Baltic Exchange.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 62
5.7 DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)
Hedging of bunker expenses
The Group has entered bunker derivatives in order to hedge future bunker expenses. The
bunker derivatives are accounted for as cash flow hedges.
The bunker derivatives are entered simultaneously with the Contracts of Affreightment
(CoA) or single cargoes, as part of the Group’s risk management. The bunker derivatives
cover the bunker expenses in connection with the CoA and the duration of the bunker
derivative is therefore similar to the duration of the CoA. 86% of the nominal value is
realised within 1 year and 14% is realised within 1-3 years. The nominal value at the end of
the year is USD 37 million and a drop in bunker prices of 10% will have a negative impact
on equity of USD 4 million. Ultranav International ApS has established a hedge ratio of 1:1
as the underlying risk of the hedging instrument is identical to the hedged risk component.
Hedge ineffectiveness can arise from differences in timing of the cash flows as well as
changes to the forecasted amounts. No ineffectiveness has been recognised.
Hedging of freight rates
The Group has entered into freight derivatives (“FFAs”) in order to hedge future cargo and
vessel commitments. The freight derivatives comprise a portfolio of swaps and call options
which are accounted for as cash flow hedges as part of Ultrabulk’s risk management. 35%
of the nominal value is realised within 1 year and 70% is realised within 1-3 years. The
nominal value at the end of the year is USD 134 million and a drop in the Baltic Dry rates of
10% will have a negative impact on equity of USD 13 million.
The Group has established a hedge ratio of 1:1 as the underlying risk of the hedging
instrument is identical to the hedged risk component. Hedge ineffectiveness can arise from
price difference between the Baltic Dry and the actual freight rates and difference in
number of days and timing of cash flows. No ineffectiveness has been recognised.
Economic hedging using freight derivatives
In continuation of above, Ultrabulk has also entered certain swaps with the purpose of
hedging specific routes and vessel types for which the availability of data points are not
sufficient to document an effective hedging relationship. Those swaps are labelled
economic hedging and are regarded as a business-related hedge for internal reporting
purposes. Changes in fair value of economic hedges are recognised in profit or loss.
Economic trading using freight derivatives
In line with its freight trading approach, Ultrabulk has entered certain swaps with the
purpose of economic trading. Strict control systems are in place to monitor developments
and ensuring that risk is constrained at acceptable pre-defined levels, which are duly aligned
with our strategy and proportionate with our financial strength. Changes in fair value of
those swaps are recognised in profit or loss.
Hedging of expenses in foreign currencies
Ultrabulk has entered currency forwards to hedge the USD value of the Group’s net cash
flow and reduce fluctuations in the Group’s profit. The key aspects of the currency hedging
policy are that Net Cash Flows in foreign currenies, namely DKK and EUR, are hedged with
a 12-24-month horizon. Significant capital commitments or divestments in other currencies
than USD may also be hedged.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 63
5.7 DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)
Overview of derivative financial instruments at year-end
December 31st 2023
December 31st 2022
Nominal
(USDm)
Net
days/MT
Duration
(months)
Recognised
in equity
(USDm)
Fair value
(USDm)
Nominal
(USDm)
Net
days/MT
Duration
(months)
Recognised
in equity
(USDm)
Fair value
(USDm)
Hedge accounting applied
FX hedges (USD/DKK)
12.5
-
1-12
-1.1
-
16.6
-
1-12
1.1
1.1
FFA swaps (Days)
134.4
10,048
1-36
8.1
10.5
195.5
13,692
1-36
-0.1
-0.1
Bunker hedges (MT)
36.7
71.886
1-60
0.4
0.2
54.6
117,540
1-60
-0.6
-0.6
Hedge accounting not applied
FFAs (Days)
-0.6
-46
1-24
-0.2
3.0
240
1-24
0.2
Net fair value of derivative instruments
10.5
0.6
USD millions
Fair value
Fair value
Presentation in the Consolidated Financial Statement as:
Derivative financial instruments, non-current assets
3.8
2.1
Derivative financial instruments, current asset
25.5
3.0
Derivative financial instruments, non-current liabilities
-3.7
-0.8
Derivative financial instruments, current liabilities
-15.1
-3.7
Net fair value of derivative financial instruments
10.5
0.6
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 64
5.7 DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)
Net amount recognised in Other Comprehensive Income
USD millions
2023
2022
Effective portion of changes in fair value from:
FX hedges
-1.2
0.1
Bunker hedges
3.4
5.2
FFA hedges
7.5
-14.8
Cash deposit designated as cash-flow hedge
-4.5
-
Amounts reclassified to profit and loss:
FX hedges reclassified to financial items
0.1
1.2
Bunker hedges reclassified to voyage related
expenses
-9.7
-19.5
FFA hedges reclassified to revenue
7.3
5.6
FFA hedges reclassified to voyage expenses
0.0
5.3
Cash flow hedges, gain/loss for the year (net)
3.0
-16.9
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 65
SECTION 6: OTHER DISCLOSURES
6.1 REMUNERATION OF MANAGEMENT
6.2 FEE TO THE STATUTORY AUDITORS
6.3 CONTINGENT LIABILITIES AND COMMITMENTS
6.4 OTHER NON-OPERATING CASH ITEMS (CASH FLOW)
6.5 CHANGE IN WORKING CAPITAL (CASH FLOW)
6.6 CHANGE IN LIABILITIES (CASH FLOW)
6.7 RELATED PARTY DISCLOSURES
6.8 SHARE CAPITAL
6.9 EVENTS AFTER THE BALANCE SHEET DATE
6.10 GROUP STRUCTURE
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 66
6.1 REMUNERATION OF MANAGEMENT
Remuneration of Board of Directors
The members of the Board of Directors do not receive any fees or incentives from the
Group.
Remuneration of Executive Management
The Executive Management comprise of two members, all of which are remunerated
directly by the parent company.
USD thousands
2023
Fixed salaries
251
Pensions – defined contribution plans
24
Incentive payments (cash based)
132
Total remuneration included in Staff expenses
407
Until 25 November 2022, the parent company was managed by the Board of Directors. On
26 November 2022, when the parent company was redomiciled to Denmark, Per Lange was
appointed to CEO. The remuneration to the CEO in 2022 is not disclosed pursuant to the
Danish Financial Statement Act section 98b(3).
Key management personnel
In 2023, key management personnel of Ultranav International ApS Group comprised seven
members, of which five members did not receive any remuneration or incentives directly
from the Ultranav International ApS or its subsidiaries. Those five members were
remunerated through other related companies. Consequently, the remuneration included
in staff expenses comprise only the remuneration paid to two members of key management
personnel. The fee for key management personnel services were recorded in “Other
external expenses” in the Profit or Loss.
USD thousands
2023
2022
Fixed salaries
427
473
Pensions – defined contribution plans
21
19
Incentive payments (cash based)
707
837
Total remuneration included in Staff expenses
1,155
1,329
Fee included in Other external expenses
2,500
1,800
Total expense for Key Management Personnel
3,655
3,129
Key management personnel are subject to a notice of up to 18 months and can resign from
Management with a notice of up to 9 months. Senior Management and a number of
employees are covered by a cash-based incentive scheme.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 67
6.2 FEE TO THE STATUTORY AUDITORS
Total fee for statutory auditors breaks down as follows:
USD thousands
2023
2022
Statutory audit
392
322
Other assurance engagements
-
-
Tax assurance services
33
20
Other services
2
22
Fees to statutory auditors
427
364
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 68
6.3 CONTINGENT LIABILITIES & COMMITMENTS
§ ACCOUNTING POLICIES
Provisions are recognised when the Group has a present obligation (legal or constructive)
as a result of a past event, it is probable that the obligation has to be settled and that a
reliable estimate of the obligation can be made.
Contingent liabilities
The Group is part in certain litigation proceedings. In the opinion of management,
settlement or continuation of these proceedings are not expected to have a material effect
on the Group’s financial position, operating profit or cash flow.
The parent company is jointly taxed with other Danish companies in the Ultranav
International ApS Group. The companies are jointly and unlimited liable for Danish
corporation tax and withholding taxes on dividends, interest and royalties in the joint
taxation. Any subsequent corrections of joint taxation of income or withholding taxes on
dividends, etc, could lead to Company’s liability constituting a larger amount.
The Group's Danish companies are jointly and separately liable for the joint registration of
VAT.
Guarantees
The Group has issued guarantees for loans to joint ventures and related companies. The
table below summarises guarantees at year-end:
USD thousands
2023
2022
Guarantees
The Group has issued guarantees for loans to joint ventures
14,455
16,017
The Group has issued guarantees for credit facilities in related
companies
99,000
75,000
Total
113,455
91,017
Short-term leases and low value leases
The Group has recognized right-of-use assets in line with IFRS 16, except for short term and
low value leases. The table below summarises future commitments on short term and low
value leases which are entered at year-end:
USD thousands
2023
2022
Short term leases and low value leases
318,086
250,297
Total
318,086
250,297
COAs and Time Charter commitments as service provider
At 31 December, the Group had entered into Contracts of Affreightment (“COAs”) and time
charters with customers amounting to:
USD thousands
2023
2022
COAs and Time Charter commitments as service provider
Within one year
321,465
280,149
Between 1 – 5 years
101,356
223,109
More than 5 years
3,927
5,533
Total
426,748
508,791
COAs constitute a commitment to transport cargoes in a predetermined period and at a
predetermined price per ton. Time charter commitments as a service provider constitute a
commitment to charter a vessel to a customer.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 69
6.4 OTHER NON-OPERATING CASH ITEMS
(CASH-FLOW)
USD thousands
2023
2022
Gain on sale of vessels, plant, and equipment
-58,644
-36,690
Gain from disposal of associates
-8,747
-
Depreciation and impairment loss
199,751
212,702
Share of profit from investments accounted for using equity
method
-47,349
-20,420
Interest income on loans
-15,655
-3,586
Interest expenses on loans
18,896
7,579
Interest expenses on lease liabilities
13,071
10,323
Interest expenses on to related parties
430
4,012
Modification of lease liabilities
-1,092
-1,211
Economic trading
36
1,256
Economic hedge
439
-242
Other non-cash operating items
-2,701
-3,921
Total
98,435
169,802
6.5 CHANGE IN WORKING CAPITAL
(CASH-FLOW)
USD thousands
2023
2022
Change in receivables
6,890
-64,726
Change in inventories
5,029
-4,468
Change in liabilities
-51,283
39,779
Total
-39,364
-29,415
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 70
6.6 CHANGES IN LIABILITIES (CASH FLOW)
Changes in liabilities arising from finance activities
2023
USD thousands
1 January
Cash in-flow
Cash out-flow
Other
31 December
Lease liabilities
311,239
-
-169,819
186,716
328,136
Interest-bearing loans and borrowings
275,737
14,615
-12,239
11,211
289,324
Total liabilities from financing activities
586,976
14,615
-182,058
197,926
617,460
2022
USD thousands
1 January
Cash in-flow
Cash out-flow
Other
31 December
Lease liabilities
310,121
-
-161,312
162,430
311,239
Interest-bearing loans and borrowings
201,610
160,000
-89,075
3,202
275,737
Total liabilities from financing activities
511,731
160,000
-250,387
165,632
586,976
The category ‘Other’ comprise primarily of additions and remeasurements of lease liabilities as well as interest accruals included in the carrying value of interest-bearing loans and
borrowings. Reference is made to note 5.4 – Lease liabilities.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 71
6.7 RELATED PARTY DISCLOSURES
Ownership
Ultranav International ApS is a wholly-owned subsidiary of Naviera Ultranav Dos Limitada,
Av, El Bosque Norte 500 Piso 20, 7550092 Las Condes, Santiago, Chile.
The Consolidated Financial Statements of Ultranav International ApS is available at the
Company's address. The ultimate controlling party of Ultranav International ApS is
Inversiones Volcán Mocho S.A., Av, El Bosque Norte 500 Piso 22, 7550092 Las Condes,
Santiago, Chile.
Transactions with related parties
The table below summarises transactions made in the financial year and amounts owed at
year-end:
Sales/(Purchases)
Amounts owed by/(to)
USD thousands
2023
2022
2023
2022
Related companies
Charter income
36,589
58,827
-
-
Management fee income
3,011
3,368
-
-
Management fee expense
-29,965
-24,664
-
-
Interest & Loans
22,937
-1,089
333,139
261,555
Receivables and payables
-
-4,035
3,461
Sales of vessels
24,766
1,142
-
-
Joint Ventures & Associates
Charter hire
207,598
138,211
-
-
Charter expenses
-52,394
-59,130
-
-
Management fee income
7,108
5,964
-
-
Receivables and payables
-
-
72,872
51,701
Guarantees
-
-
14,455
16,017
Loans
-
302
-
-
6.8 SHARE CAPITAL
The share capital is split in 135,360,000 shares of DKK 1 per share, totalling a nominal share
capital of 135,360,000 DKK. In connection with the parent company’s redomiciliation of its
registered office to Denmark on 25 November 2022, the share capital was converted to be
denominated in DKK. Apart from this, there has been no changes in the share capital over
the past five years.
6.9 EVENTS AFTER THE BALANCE SHEET DATE
Disclosure of events after the balance sheet date
No events have occurred after the balance sheet date that materially affect the financial
position of the Group. Reference is made to note 3.5 to the Consolidated Financial
Statements with regards to a business combination that has occured after the reporting
date.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 72
6.10 GROUP STRUCTURE
The Naviera Ultranav Group has been present in Denmark for more than 15 years through
its dry bulk activities (Ultrabulk A/S) and its fleet of gas carriers (now merged with Navigator
Holdings Ltd.). Today, the Danish holding company is also the owner of the Ultranav Group’s
international activities within the segments Tankers, Dry bulk, Gas carriers.
The Ultranav International ApS Group comprise more than 30 subsidiaries at the balance
sheet date of which the largest are listed below.
List of material subsidiaries included in the Consolidated Financial Statements
Share of ownership
Ultrabulk A/S, Denmark
99.0%
Ultrabulk (Asia) Pte. Ltd., Singapore
99.0%
Ultrabulk Cargo Services GmbH, Germany
99.0%
Cape Tankers Inc., Panama
87.5%
Ultratank Shipping S.A., Uruguay
100.0%
Horizon Shipping, Inc, Panama
100.0%
Austral Product Tankers Inc, Panama
100,0%
Petrolera Transoceánica S.A., Peru
99,75%
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 NOTES | PAGE 73
PARENT COMPANY FINANCIAL STATEMENTS
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 74
PROFIT OR LOSS
1 JANUARY – 31 DECEMBER
USD thousands
Note
2023
2022
Revenue
351
14,047
Vessel operating costs and voyage related expenses
-
-10,217
Gross profit
351
3,830
Other external expenses
-1,072
-1,011
Staff costs
2
-571
-38
Operating profit before depreciation (EBITDA)
-1,292
2,781
Depreciations and amortisations
-
-1,738
Operating profit (EBIT)
-1,292
1,043
Share of subsidiaries’ profit after tax
3
302,792
138,866
Share of associates’ profit after tax
4
31,050
25,069
Gain from disposal of associates
8,747
-
Financial income
5
30,472
2,915
Financial expenses
5
-18,290
-2,708
Profit/loss before tax
353,479
165,185
Tax
6
-15,116
-4,628
Profit/loss for the period
338,363
160,557
Proposal for the distribution of net result:
Reserve for net revaluation according to equity method
333,842
163,935
Retained earnings
4,735
-3,378
Profit/loss for the period
338,363
160,557
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 75
BALANCE SHEET
ASSETS
USD thousands
Note
2023
2022
Investments in subsidiaries
3
791,390
735,796
Investments in associates
4
267,814
248,205
Loans to related companies
4,732
110,000
Other receivables
-
3
Deferred tax assets
6
-
583
Financial assets, non-current
1,063,936
1,094,587
Total non-current assets
1,063,936
1,094,587
Trade and other receivables
6
38
Prepayments
56
21
Receivables from related companies
-
984
Loans to related companies
325,835
157,349
Cash and short-term deposits
231,858
26,572
Total current assets
557,755
184,964
TOTAL ASSETS
1,621,691
1,279,551
EQUITY AND LIABILITIES
USD thousands
Note
2023
2022
Share capital
18,311
18,311
Retained earnings
1,199,467
897,659
Reserve for net revaluation according to equity method
158,969
118,109
Total equity
1,376,747
1,034,079
Interest bearing loans and borrowings
7
234,547
234,350
Total non-current liabilities
234,547
234,350
Trade and other payables
183
353
Interest bearing loans and borrowings
7
4,593
3,488
Income tax payable
4,951
7,281
Payables to related companies
670
-
Total current liabilities
10,397
11,122
Total liabilities
244,944
245,472
TOTAL EQUITY AND LIABILITIES
1,621,691
1,279,551
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 76
STATEMENT OF CHANGES IN EQUITY
USD thousands
Share capital
Cash flow
hedge reserve
Reserve for
net revaluation
according to
equity method
Retained
earnings
Total equity
Equity as 1 January 2023
18,311
-
118,109
897,659
1,034,079
Net result
-
-
333,842
4,521
338,363
Dividends received from subsidiaries and associates
-
-
-297,290
297,290
-
Other equity movements in subsidiaries and associates
-
-
4,308
4,308
Other changes
-
-
-
-3
-3
Equity as 31 December 2023
18,311
-
158,969
1,199,467
1,376,747
Equity as 1 January 2022
18,311
-51
285,310
215,971
519,541
Net result
-
-
163,935
-3,378
160,557
Dividends received from subsidiaries and associates
-
-
-125,706
125,706
-
Other equity movements in subsidiaries and associates
-
-
-24,769
-
-24,769
Business combination under common control
-
-
-
379,229
379,229
Cash flow hedges
-
51
-
-
51
Other changes
-
-
-180,661
180,131
-530
Equity as 31 December 2022
18,311
-
118,109
897,659
1,034,079
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 77
1 BASIS OF REPORTING
⌂ MAIN ACTIVITIES
The main activities of parent company, UItranav International ApS, comprise holding of
shares in subsidiaries, associates and joint ventures, as well as group funding and cash
management.
§ GENERAL ACCOUNTING POLICIES
The Parent Company Financial Statements of Ultranav International ApS have been
prepared pursuant to the provisions for large class C enterprises of the Danish Financial
Statements Act.
The Company’s business is primarily based on the US Dollar. All income in the form of freight
income is in US Dollar, and most costs are in US Dollars as well. Based on this, the Company
has designated the US Dollar as its functional and reporting currency. Consequently, all
amounts are recognised in US Dollar. For USD conversion rate to DKK please refer to note
1.1 of the consolidated financial statements.
The Consolidated Financial Statements have been prepared in accordance with IFRS. The
accounting policies applied for the Consolidated Financial Statements regarding recognition
and measurement have also been applied for the Parent Company with the below
exemptions.
With reference to the provisions of the Danish Financial Statements Act §86 para. 4., the
Company has refrained from preparing a cash flow statement in the Parent Company
Financial Statements. For this information, see the Consolidated Financial Statements for
Ultranav International ApS.
2 STAFF COSTS
USD thousands
2023
2022
Wages and salaries
-506
-34
Pensions – defined contribution plans
-50
-4
Other staff costs
-15
-
Staff costs
-571
- 38
Average number of employees in the year
4
0
Headcount at end of year
4
4
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 78
3 INVESTMENTS IN SUBSIDIARIES
§ ACCOUNTING POLICIES
Investments in subsidiaries are recognised and measured according to the equity method.
The proportional share of profit or loss of subsidiaries are included in Profit or Loss. The
proportional share of net assets of subsidiaries are included in the balance sheet.
Subsidiaries with negative net asset value are recognised at USD 0 million, and a provision
to cover the negative balance is recognised if such a present obligation for this purpose
exists.
The net value adjustment to the cost of investments in subsidiaries is, when positive,
recognised in the “Reserve for net revaluation according to equity method” under equity.
The reserve is reduced by dividend payments from subsidiaries.
USD thousands
2023
2022
Cost at 1 January
643,624
28,525
Transferred from Investments in associates
13,052
-
Acquired through business combination
-
330,305
Additions for the year
32,797
313,329
Disposals
-
-28,535
Cost at 31 December
689,473
643,624
Value adjustment at 1 January
92,172
253,531
Share of result for the year
302,792
138,866
Dividends
-297,290
-124,906
Disposals
-
-150,305
Movements in equity in subsidiaries
4,229
-24,769
Other increase/(decrease)
14
-245
Value adjustment at 31 December
101,917
92,172
Carrying amount at 31 December
791,390
735,796
Specification of direct investments:
Company
Registered office
Ownership
Ultrabulk A/S
Denmark
99.0%
Ultranav Business Support ApS
Denmark
100.0%
Ultratank Shipping ApS
Denmark
100.0%
Ultratug ApS
Denmark
100.0%
Ultranav International II S.A.
Panama
100.0%
Petrolera Transoceánica S.A.
Peru
50,0%
Reclassification of investment in Petrolera Transoceánica S.A.
While the parent company’s interest in Petrolera Transoceánica S.A. remains unchanged at
50% of outstanding shares, the classification of the interest is deemed to have changed as
a subsidiary to the parent company has purchased the remaining shares in same, whereby
that the Group has obtained a controlling interest. Reference is made to note 3.5 to the
Consolidated Financial Statements.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 79
4 INVESTMENTS IN ASSOCIATES
§ ACCOUNTING POLICIES
Investments in associates are recognised and measured according to the equity method.
The proportional share of profit or loss of associates are included in Profit or Loss. The
proportional share of net assets of associates are included in the balance sheet. Associates
with negative net asset value are recognised at USD 0 million (2022: USD 0 million). A
provision to cover net liabilites is recognised when such an obligation exists.
The net value adjustment to the cost of investments in associates is, when positive,
recognised in the “Reserve for net revaluation according to equity method” under equity.
The reserve is reduced by dividend payments from associates.
USD thousands
2023
2022
Cost at 1 January
222,268
237,907
Additions for the year
3,726
7,645
Transferred to Investment in subsidiaries
-13,052
-
Disposals
-
-23,284
Cost at 31 December
212,942
222,268
Value adjustment at 1 January
25,937
31,779
Share of result for the year
31,050
25,069
Dividends
-2,120
-800
Disposals
-
-29,580
Other increase/(decrease)
5
-531
Value adjustment at 31 December
54,872
25,937
Carrying amount at 31 December
267,814
248,205
Specification of direct investments:
Company
Registered office
Ownership
Navigator Holdings Ltd.
Marshall Islands
29.0%
Naviera Transoceánica S.A.
Peru
1.0%
Upteko ApS
Denmark
14.1%
Port-Safety ApS
Denmark
15.0%
United Overseas Product II AS
Norway
10.0%
Northen Expeditions AS
Norway
35.0%
MAHI BV
Belgium
3.0%
Cliin Robotics
Denmark
14.1%
Creative Sight
Denmark
11.9%
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 80
5 FINANCIAL ITEMS
USD thousands
2023
2022
Interest income
7,871
1,293
Interest income, loans to related parties
22,601
1,622
Financial income
30,472
2,915
-
Interest expenses, bank loans and overdrafts
-17,788
-2,011
Interest expenses, loans from related parties
-
-318
Interest expenses, lease liabilities
-
-239
Other financial items, net
-502
-140
Financial expenses
-18,290
-2,708
6 TAX
USD thousands
2023
2022
Current tax on profit for the year
-14,533
-5,225
Deferred tax for the year
-488
583
Tax on profit for the year
-15,021
-4,642
Adjustments related to previous years – current tax
119
14
Tax in the income statement
-14,902
-4,628
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 81
7 INTEREST BEARING LOANS AND BORROWINGS
§ ACCOUNTING POLICIES
Loans are recognised at the time the loans are obtained in the amount of the proceeds after
deduction of transaction costs. In subsequent periods, the loans are recognised at
amortised costs.
Carrying amount
USD thousands
Type
2023
2022
Interest bearing loans
Floating
239,140
237,838
Interest bearing loans and borrowings
239,140
237,838
Non-current portion
234,547
234,350
Current portion
4,593
3,488
Interest bearing loans and borrowings
239,140
237,838
The floating-rate loans are based upon the USDLIBOR and SOFR6M with an additional
margin of 1.95% - 2.65% (2022: 1.80% - 2.65%). The interest rate on the floating rate
interest bearing loan was between 7.25% - 8.15% (2022: 3.25% - 5.20%).
The fair value of the fixed loans is not materially different from the carrying amount.
The loans are subject to financial and operational covenants, including a minimum equity.
Management assesses that Parent Company and the Group meet these covenants at the
closing date as well as throughout the financial year.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 82
8 CONTINGENT LIABILITIES
Ultranav International ApS is in joint taxation with other Danish companies in the Group.
Reference is made to note 6.3 to the Consolidated Financial Statements.
9 GUARANTEES
Ultranav International ApS loans to joint ventures and related companies. The table below
summarises guarantees at year-end:
USD thousands
2023
2022
Guarantees
The company has issued guarantees for loans to related
companies
133,036
112,818
The company has issued performance guarantees to
subsidiaries
86,162
81,147
Total
219,198
193,965
In addition to above, Ultranav International ApS has issued guarantees to certain
counterparties through which we are entering derivative financial instruments for hedging
purposes. Reference is made to note 5.7 to the Consolidated Financial Statements which
details the maximum exposure of the Group.
10 RELATED PARTY DISCLOSURES
Reference is made to note 6.7 in the consolidated financial statements, for related party
transactions with other than wholly owned subsidiaries of Ultranav International ApS.
In accordance with section 98c(3) of the Danish Financial Statements Act, the Company has
not disclosed any related party transactions with its wholly owned subsidiaries.
Ownership:
Ultranav International ApS is a wholly-owned subsidiary of Naviera Ultranav Dos Limitada,
Av, El Bosque Norte 500 Piso 20, 7550092 Las Condes, Santiago, Chile.
The Consolidated Financial Statements of Ultranav International ApS is available at the
Company's address. The ultimate controlling party of Ultranav International ApS is
Inversiones Volcán Mocho S.A., Av, El Bosque Norte 500 Piso 22, 7550092 Las Condes,
Santiago, Chile.
11 EVENTS AFTER THE BALANCE SHEET DATE
For subsequent events, reference is made to note 6.9 in the Consolidated Financial
Statements.
ULTRANAV INTERNATIONAL ANNUAL REPORT 2023 PARENT COMPANY FINANCIAL STATEMENTS | PAGE 83
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