ANNUAL REPORT 2023
Registration no. 40 53 35 16
The Annual General Meeting adopted the Annual Report on 28 June 2024
Chairman of the General Meeting
Name
: Morten Berggreen
2
Klik e ller try k he r for at skrive t ekst.
Contents
Contents ..................................................................................................................................................... 2
Key figures ..................................................................................................................................................... 3
Board of Directors Report ................................................................................................................................. 4
Consolidated financial statements .................................................................................................................... 16
Parent company financial statements ............................................................................................................... 47
Statement by the Board of Directors and Executive Management ........................................................................ 66
Independent Auditor’s Report .......................................................................................................................... 67
Definitions and glossary ................................................................................................................................. 70
Company information ..................................................................................................................................... 71
3
Key figures
* Including reversal of previous years impairments of USD 41.2 million.
Key figures presented in the table above for the years 2019 and 2020 is based on figures for the parent company
Christiania Shipping A/S.
4
Board of Directors Report
2021
2023 ended up as a satisfying year for Christiania
Shipping A/S.
The Group reported:
• EBITDA USD 42.7 million (2022: USD 50.7
million)
• Net profit USD 68.8 million was positively
affected by reversal of previous years impairment
of USD 40.7 million (2022: USD 40.0 million)
The firm market for small chemical carriers continued
into 2023, although the average TC rates obtained for
the second half of the year was somewhat weaker than
for the first part of the year.
In 2023, the Group acquired three vessels. Additionally,
the Group invested in two newbuilding 13,000 dwt
stainless steel chemical vessels with delivery in 2025
and 2026.
The Group amended the existing loan agreement with
NIBC as well as re-financed two vessels through
bareboat arrangements.
Business review
Christiania Shipping A/S, previously Herning Shipping
A/S, is a specialized chemical vessel-owning and
chartering company established in 1972, with roots
back to 1963.
Herning Shipping A/S was acquired by Eitzen Avanti AS
(formerly ANE Shipping AS) in 2018 and following the
acquisition the Company was renamed to Christiania
Shipping A/S. The headquarter is in Copenhagen,
Denmark.
The core competence of Christiania Shipping is to own
and charter sophisticated chemical tankers between
3,500 - 13,000 dwt with highest focus on safety and
quality.
Christiania Shipping has a leading position in trade
niches and the vessels are trading in the Atlantic Ocean,
Europe, West Africa and the Mediterranean.
As of 31 December 2023, the Group’s fleet consisted of
18 stainless steel and Marline-Line coated vessels
ranging from 3,500 - 12,000 dwt, of which 17 vessels
owned and one vessel on time charter.
Organization
The Group’s administration is in Copenhagen. At the end
of 2023 the Group employed 24 full time staff. The sick
leave during 2023 was 110 days of the total working
days mainly due to long-term illness (0 days in 2022).
The Group has not been affected by serious work-
related accidents during the year. As per December
2023, 8 out of 24 employees were female (33%). The
organization is considered to be well-qualified to
perform the tasks within its remit.
Strategic focus
Safety is Christiania Shipping’s first and foremost
priority and it is an integral part of Christiania Shipping’s
vision, mission, strategy and values. The Group’s
overall strategic focus is:
• Develop a safety culture with a target of zero
accidents
• Optimize and develop the existing business
platform
• Expand and renew the fleet
• Continue the consolidation within the chemical
tanker segment and generate profitable growth
5
Management
Board of Directors
The Board of Directors of Christiania Shipping A/S
consists of three members with solid Management
experience. The Board has a reasonable size,
composition and the competences necessary to ensure
that they at any given time are qualified to attend to
the managerial tasks as the upper Management body of
the Group.
In 2023 the Board of Directors consisted of:
• Axel Camillo Eitzen, Chairman
• Fridtjof Camillo Eitzen
• Axel Stove Lorentzen
From 1 January 2023, Fridtjof C. Eitzen commenced as
CEO of the Company, while Axel C. Eitzen was elected
as chairman of the Board from 1 January 2023.
The Executive Management in 2023 consisted of Fridtjof
C. Eitzen (CEO), Snorre Krogstad (CFO), Torben Larsen
(COO), Rune Eriksen (COM) and Anne Sofie Reimann
(CARO).
Market
Rates
After several challenging years in the small chemical
market segment, the market has finally improved to a
very satisfactory market in 2022.
The TC rates for small chemical vessels continued to be
firm in 2023 and started about USD 18,000 per day for
the Christiania fleet. The market was firm the first half
year with a weakening tendency in the second half of
the year. The average TC rate for the fleet for the full
year was USD 15,797 per day.
Total idling days for the fleet in 2023 was 156 days
corresponding to 2.4% compared to 2.1% in 2022.
Supply
The primary market for Christiania Shipping is the small
chemical tanker vessel size (1,000 – 9,999 dwt) and
medium chemical tanker vessel size (10,000 – 18,000
dwt).
The world-wide small chemical fleet market (< 10,000
dwt) consists of about 1,440 vessels. 33 vessels were
delivered in 2023, while three vessels were removed
corresponding to a net growth of about 2.3%.
23% of the trading fleet is over 20 years of age while
30% is 15-19 years and only 12% is less than 5 years.
The orderbook for 2024 is scheduled at 53 vessels. Due
to the age profile of the fleet, removals are expected to
increase going forward, and the net fleet growth is
estimated to be 3.1% in 2024 and 1.0% in 2025.
The world-wide medium (10,000 – 18,000 dwt)
chemical fleet market consist of about 845 vessels. 8
vessels were delivered in 2023, while one was removed
corresponding to a net growth of about 0.9%.
15% of the trading fleet is over 20 years of age while
48% is 15-19 years and only 7% is less than 5 years.
Based on the anticipated removals and the current
orderbook, a fleet growth of 1.6% is estimated in 2024
and 0.2% is estimated in 2025.
Supply and demand in the small chemical vessel
segment is a thin line where as few as 20-30 vessels
can make the difference between a slow market and a
good market.
6
Subsequent events
5 March 2024 Christiania Shipping acquired Sigaia
Theresa from the BB owners.
28 April 2024 Christiania Shipping took delivery of the
12,000 dwt stainless steel 2019 built vessel Julia
Theresa on a 10 year BB agreement.
14 May 2024 Christiania Shipping sold the 2009 built
8,000 dwt vessel Annelise Theresa.
31 May 2024 the shares in Christiania Shipping A/S was
contributed to Christiania Holding A/S as a non-cash
contribution.
4 June 2024 Christiania Shipping sold the 2009 built
13,000 dwt vessel Diana Theresa.
See also subsequent events disclosures in note 27.
Financial highlights of the Company in 2023
Profit and loss
For the full year 2023 Christiania Shipping’s time
charter equivalent earnings was USD 94.6 million (USD
97.3 million in 2022). The reduction reflects the
decrease in number of vessel trading days, 6,426 days
in 2023 compared to 6,743 days in 2022, as a result of
re-delivery of vessels on TC in. The reduction in number
of vessel days is partly offset by an increase in TCE
(Time Charter Equivalent) from USD 14,437 per day in
2022 to USD 14,719 per day in 2023. Total number of
off-hire and idling days were 391 in 2023 compared to
339 in 2022.
The vessel operating expenses amounted to USD 32.6
million (USD 27.6 million in 2022) corresponding to an
average daily operating cost per vessel of USD 6,215
per day compared to USD 5,321 per day in 2022. The
increase reflects a general increase in the crew cost,
inflation as well as some additional maintenance cost
related to the acquisition of vessels. TC expenses for the
year was USD 11.6 million (USD 13.9 million in 2022).
The decrease reflects re-delivery of vessels on TC
during the year resulting in a decrease of TC days from
1,954 days in 2022 to 1,284 days in 2023.
SG&A for the year amounted to USD 7.7 million
compared to USD 5.1 million in 2022. The increase is
mostly due to increased bonus payments to the land-
based employees as well as general price index growth.
EBITDA for the year was USD 42.7 million compared to
USD 50.7 million previous year. At the beginning of
2023, the Group guided on an EBITDA of about USD 40
million.
Ordinary depreciation was USD 8.5 million compared to
USD 6.3 million previous year. Prior year impairments
of USD 40.7 million were reversed.
Financial expenses for the year were USD 7.4 million
(USD 6.0 million in 2022). The increase is mostly due
to increased debt related to the acquisition of three
vessels during the year as well as increase in the SOFR
rate during the year. Financial income for the year were
USD 1.3 million (USD 0.3 million in 2022). The increase
is mostly due to increased interest received on bank
deposit as well as interest from intercompany loans.
The Group had a tax income for 2023 of USD 55
thousand, compared to a tax income of USD 99
thousand in 2022.
The Group reported a profit of USD 68.8 million
compared to USD 40.0 million in 2022.
Statement of financial positions
The Group’s total assets were USD 203.6 million (USD
140.3 million in 2022). The book value of owned vessels
was USD 137.3 million up from USD 72.1 million
previous year due to the acquisition of three vessels and
7
reversal of prior year impairments of USD 40.7 million.
Right-of-use assets was USD 13.2 million compared to
USD 14.0 million.
The Group has invested in two newbuildings to be
delivered in 2025 and 2026. The Group will pay for the
two first installments, while the remaining installments
are financed through BB agreements. Other financial
assets amounted to USD 8.3 million reflecting the first
installments on above mentioned newbuildings. The
newbuilding contract is in JPY while the financing is in
USD. In order to hedge the currency exposure, the
Group has acquired a USD / JPY option. As per 31
December 2023, derivatives amounted to USD 1.2
million.
Inventories was USD 3.6 million compared to USD 3.5
million last year. Trade receivables was USD 8.9 million
compared to USD 13.4 million last year. Prepayments
were USD 2.5 million compared to USD 3.4 million last
year.
Restricted cash accounts related to the bank loan with
NIBC, was USD 2.5 million compared to USD 2.3 million
previous year, the increase is related to increased
number of vessels in the fleet financed by the bank.
Cash at the end of the year was USD 22.7 million
compared to USD 24.1 million last year.
The Group’s equity amounted to USD 92.0 million
compared to USD 46.8 million last year.
Total long-term liabilities amounted to USD 79.1 million
(USD 70.1 million in 2022). Long-term bank loan was
USD 29.5 million compared to USD 31.1 million at the
end of 2022. In order to finance the acquisition of three
vessels at the end of 2023, the Group amended the
existing loan agreement with NIBC.
Long-term lease liability was at the end of the year USD
11.9 million compared to USD 12.9 million last year.
As a result of the sale and leaseback financing
arrangement of Alice Theresa and Tina Theresa in 2023,
long-term financing arrangement liabilities increased to
USD 37.6 million from USD 26.0 million in 2022.
Total current liabilities were USD 32.4 million (USD 23.5
million in 2022), of which USD 6.4 million is short-term
bank debt (USD 6.5 million in 2022), USD 1.0 million
lease liabilities (USD 0.9 million in 2022), USD 5.6
million financing arrangements liabilities (USD 2.7
million in 2022). Trade payables at year end was USD
12.1 million (USD 7.5 million in 2022), payables to
parent company was USD 4.0 million (nil in 2022), other
payables were USD 1.0 million (USD 1.6 million in 2022)
and deferred income USD 2.3 million (USD 4.0 million
in 2022).
Current assets of USD 41.2 million exceeds current
liabilities of USD 32.4 million and the liquidity is strong.
Cash flow
Cash flow from operating activities was USD 44.3 million
(USD 35.5 million in 2022). Cash flow from investing
activities was USD -33.1 million (USD -42.6 million in
2022) mainly related to investments in additional
vessels during the year. Cash flow from financing
activities was USD -12.8 million (USD 28.5 million in
2022), of which USD 17 million is related to sale and
leaseback transactions.
Net cash flow was USD -1.7 million (USD 21.4 million in
2022) and cash at the end of the year was USD 22.7
million (USD 24.1 million in 2022).
Parent company
On 31 December 2023, the parent company’s total
assets amounted to USD 129.4 million (USD 101.2
million in 2022). The parent company equity amounted
to USD 58.9 million (USD 46.8 million in 2022). The
parent company made a profit of USD 35.6 million (USD
40.0 million in 2022).
8
Outlook for 2024
The market for small chemical tankers is dependent
upon the volume of easy chemicals transported by sea,
which again is dependent upon several factors including
the development in the economy and commodity prices
among others. These factors, combined with the supply
of chemical vessels, will determine the market going
forward.
The demand for chemical vessels was weak for several
years due to periods of oversupply of chemical vessels
as well as the general impact of covid worldwide. In
2024, the market started with somewhat lower rates
and activity than experienced at the peak in 2022 and
2023, but still at a historical firm market environment.
From a historical perspective, the newbuilding
orderbook is relatively low for both the 1 - 10,000 dwt
segment and 10,000 - 18,000 dwt segment in 2024.
Based on the forecasted fleet growth combined with the
anticipated GDP growth, analysts expect the market to
continue to be firm in 2024.
However, the market is still dependent upon a
continued stable economic environment and a potential
recession in Europe will of course impact the small
chemical vessel market.
The Group expects continued firm rates and steady
volumes in 2024 which we expect will result in EBITDA
of about USD 40 million on the basis of the existing
fleet.
9
Risk Factors
Being an international player in the chemical tankers
segment, Christiania Shipping is exposed to a variety of
risks that can affect the Group’s result. The risk factors
can be divided into the following main risk components:
• Market risk
• Operational risk
• Financial risk
Such risks are normally related to volatility in charter
income, charter defaults, unforeseen operational
events, operating expenses and unforeseen capital
expenditure requirements, fluctuations in interest- and
foreign exchange rates, as well as financing risk related
to new capital expenditure requirements and
refinancing of existing credit facilities.
The Executive Management continuously monitors the
risks considered to have the most significant effect on
the Group’s business performance as well as financial
position. Measures deemed relevant to limit the Group’s
sensitivity to such risks are evaluated on an on-going
basis.
Market risk
Christiania Shipping’s revenues are exclusively
generated from activities in the oil and chemical tankers
industry. The oil and chemical tanker industry is cyclical
and volatile, which can lead to reductions in freight
rates, volumes transported, and ship values.
Fluctuations in freight rates result from changes in the
supply of chemical vessels and demand for seaborn
transportation of certain chemicals.
Christiania Shipping mitigates the risk of fluctuation in
freight rates to a certain degree, by managing the mix
between Contracts of Affreightment (COA) and spot
market business. When a vessel is fixed on a “TC out”
the rate is fixed and eliminates the volatility, while COA
reduces the volatility. Spot market business, on the
other hand, provides flexibility but exacerbates the
impact of a downturn in the market.
Operational risk
The Group is focused on delivering strong operational
performance for the fleet and is striving towards
operational excellence through strict attention on vessel
maintenance and through continued education of its
staff. Despite the Group’s high degree of pre-emptive
maintenance and education there is a risk for equipment
failure and accidents. Risks related to the operation of
the vessels, transport of cargo, personal injuries,
environmental damages, and war are covered by
insurances in internationally recognized insurance
companies. The Group aims at minimizing its exposure
by using multiple insurance companies.
The Group has established duplication of business-
critical IT systems and contingency plans in case of
breakdowns. Back-up of data is made in an external IT
environment outside the Group’s offices.
Even though the Group obtains loss of hire insurance for
contracts over a certain length, a technical breakdown
will affect the earnings for a period of at least 14 days
(deductible).
Risk related to changes in laws and regulation
The Group’s operation and vessels are subject to
international environmental laws and regulations which
have become more stringent in recent years. Although
the Group is doing its outmost to comply, changes in
laws and regulations may expose the Group.
Bunkers
Bunker fuel constitutes the major cost component
affecting time charter equivalent (TCE) earnings and
increasing prices can have a material impact on
Christiania Shipping’s results.
The Group is striving to reduce the impact of bunker
price fluctuations by passing bunker fuel costs on to
customers. Hence, in 2023 approximately 40% of
freight earnings were derived from COAs, the large
majority of which include a bunker price clause that
indexes freight rates with bunker prices.
10
EU Emission Trading System (ETS)
The EU ETS is a carbon market that uses a cap-and-
trade system of emission allowances for energy-
intensive industries and the power generation sector.
The shipping industry will be subject to the EU ETS,
where shipping companies will be required to surrender
allowance equivalent to the following amounts in
relation to ships above 5,000 GT with calls at EU ports.
Allowance will be based on MRV reporting for the
previous year and will be verified and confirmed in
January and payable latest 1 April:
• 40% of verified emissions reported for 2024
• 70% of verified emissions reported for 2025
• 100% of verified emissions reported for 2026 and
each year thereafter
The cost of including shipping in the EU ETS will be
significant for the industry. The price of CO
2
quota is
estimated to be volatile and difficult to forecast. To level
out potential price fluctuations and in order not to be
dependent upon acquiring all at one time, Christiania
Shipping will buy the quota on a monthly basis in order
to match the consumption in best possible manner.
Financial risk
Investments are typically financed by cash reserves,
equity proceeds injected by the shareholders, debt
obtained by international banks or international leasing
providers. The Group is exposed to financing risk related
to potential new investments and refinancing of existing
debt.
In July 2022, a 5 year loan was entered into with NIBC.
The facility was amended and increased in December
2023, keeping the repayment date in July 2027. The
loan agreement includes customary financial covenants.
At the end of 2023 the Group was in compliance with all
its covenants.
In addition to the bank agreement with NIBC, the Group
is utilizing financial leases and sale leaseback
arrangements, with purchase options and obligations,
to finance vessels. At the end of the year, one vessel
was classified as financial lease, corresponding to USD
12.9 million in outstanding bareboat obligations, while
six vessels were classified as financial agreement
totaling USD 42.5 million in outstanding bareboat
obligations. The average remaining tenor for the 7
vessels on bareboat with purchase obligation was at the
end of the 5.2 years.
The Group is dependent upon a stable income in order
to be able to pay interest expenses, refinance debt or
raise new debt in the future.
Interest rate risk
The Group’s bank loans are generally subject to floating
interest rates. For 2023, the Group did not hedge any
of its interest rate risk but will evaluate to hedge the
exposure going forward. The Group also finances
vessels through bareboat contracts with purchase
obligations. Five of the BB agreements are based on a
fixed bareboat rate. At the beginning of 2023 about
50% of the Group’s interest rate exposure was fixed
though the bareboat agreement. At the beginning of
2024 about 30% of the Group’s interest rate exposure
was hedged through fixed bareboat rate.
Currency risk
The Group pursues a finance policy that ensures that
foreign exchange risks arise only on the basis of
commercial factors. Most of the revenues earned by
Christiania Shipping are in the reporting currency USD
as well as EUR. A significant portion of the operating
expenses as well as administrative expenses are
incurred in primarily EUR and DKK, while BB and other
financial expenses (BB rate, interest costs and
installments) are in USD. To reduce foreign currency
exchange risk on EUR, Christiania Shipping strives to
match cash inflows and cash outflows as much as
possible. A 10 % fluctuation in the USD/EUR exchange
rate would have an approx. 2% impact on time charter
equivalent earnings for the Group in 2023.
The Group has entered into a newbuilding contract in
JPY and secured financing in USD. In order to minimize
the currency exchange risk, the Group has entered into
USD/JPY put options on back-to-back basis with the
installment plan. The put options limits the downside
risk, at the same time as it allows the Group to take
advantage of the current favorable USD/JPY exchange
11
rate.
Counterparty risk
It is the Group policy only to grant credit to oil majors
and other first-class customers to minimize credit risks.
As such, the Group’s credit risk relates to receivables
from these first-class customers and oil majors in the
chemical tanker segment. The credit risk is deemed to
be minimal and consequently receivables are not
hedged. The Group’s maximum credit risk associated
with receivables corresponds to their carrying amounts.
For smaller customers and newer customers, it is Group
policy to perform a credit assessment based on credit
reports retrieved out of the database of one of the
world’s largest vendors. In most cases, such credit
reports include a credit rating and information on
potential payment delinquency. Furthermore, it is
custom to require freight to be paid before cargo
release. For customers with whom Christiania Shipping
has a long-lasting relationship, freight is typically paid
after cargo release. In 2023, Christiania Shipping did
not suffer any significant losses from defaulting
customers.
Liquidity risk
The shipping market is capital intensive and insufficient
liquidity will severely impact the ability to operate. The
Group’s approach to manage liquidity risk is to ensure,
as far as possible that it will always have sufficient
liquidity to meet its obligations. Cash flow developments
are monitored daily, including monthly updates to the
Executive Management. Furthermore, the Group
evaluates its capital structure and explores various
options to safeguard liquidity. The Group has a
minimum liquidity covenant in its credit facility.
In 2024, Christiania Shipping expects to have sufficient
liquidity for meeting its payment obligations for
conducting the normal course of its operations without
needing the support from its shareholder.
12
13
14
15
16
Statement on gender composition (§99b
of the Financial Statement Act)
Christiania Shipping believes in equal opportunity. As
per 31 December 2023, the Group employed 24 full
time staff in its office in Copenhagen and Golfe-Juan of
which 8 were female (equivalent to 33%).
Target for the Board of Christiania Shipping A/S:
As per 31 December 2023, the Board of Directors
consisted of three members, all men. The Group is
Policy to increase gender diversity on other
management levels:
Board of Directors 2023
Total number of members 3
Underrepresented gender % 0 %
Target figure % 25 %
Year for meeting target 2025
Executive Management 2023
Total number of members 5
Underrepresented gender % 20 %
17
Consolidated financial statements
Page
Consolidated income statement ....................................................................................................................... 18
Consolidated balance sheet ............................................................................................................................. 19
Consolidated statement of changes in equity ..................................................................................................... 21
Consolidated statement of cash flow ................................................................................................................ 22
Notes to the consolidated financial statements .................................................................................................. 23
18
Consolidated income statement
1 January - 31 December
USD '000
Note
2023
2022
Net freight income
3
Voyage related expenses
4
-41.936
-59.630
Time charter equivalent earnings
Time charter expenses
-11.623
-13.932
Operating expenses
5
-32.561
-27.630
Administrative expenses
5, 6, 7
-7.741
-5.117
Operating profit before depreciation etc. (EBITDA)
Depreciation
8
-8.538
-6.282
Impairment gains/losses of fixed assets
8, 12
Gains from sale of fixed assets
8
Operating profit (EBIT)
Finance income
9
Finance expenses
10
-7.379
-5.963
Profit/loss before tax
Tax for the year
11
Profit/loss for the year
Attributable to:
Shareholders of Christiania Shipping A/S
Proposed dividend
OTHER COMPREHENSIVE INCOME
USD '000
2023
2022
Profit/loss for the year
Items which will be reclassified to the income statement:
Value adjustment of hedges for the year
-498
Conversion differences
-57
Other comprehensive income
-498
-57
Total comprehensive income
Attributable to:
Shareholders of Christiania Shipping A/S
Proposed dividend
19
Consolidated balance sheet
at 31 December
USD '000
Note
2023
2022
ASSETS
Vessels
12
Prepayments on vessels and dockings under construction
12
Property, plant and equipment
12
Right-of-use assets
13
Other financial asset
14
Derivatives
Deferred tax asset
Total tangible assets
Inventories
Trade receivables
15
Receivables from parent company
Receivables from group enterprises
Other receivables
Prepayments
16
Cash and cash equivalents
17
Restricted cash
17, 19
Total current assets
Total assets
20
Consolidated balance sheet
at 31 December
USD '000
Note
2023
2022
EQUITY AND LIABILITIES
Share capital
18
Retained earnings
Proposed dividend
Total equity
Long-term debt
19
Long-term lease liability
13
Long-term financing arrangements
20
Other non-current liabilities
Total non-current liabilities
Current portion of long-term debt
19
Current portion of lease liability
13
Current portion of financing arrangements
20
Trade payables
21
Payables to parent company
Payables to related parties
Current tax liabilities
Other current liabilities
Deferred income
Total current liabilities
Total liabilities
Total equity and liabilities
21
Consolidated statement of changes in equity
1 January - 31 December 2023
USD '000
Share
capital
Retained
earnings
Proposed
dividend
Total
Equity at 1 January 2023
Paid dividend
-23.000
-23.000
Proposed dividend related to 2023
Changes in equity
-10.937
-10.937
Comprehensive income for the year
Other comprehensive income, net of tax
-498
-498
Profit/loss for the year
Total comprehensive income for the year
Equity at 31 December 2023
1 January - 31 December 2022
USD '000
Share
capital
Retained
earnings
Proposed
dividend
Total
Equity at 1 January 2022
Purchase of treasury shares
-5
-5
Convertion of intercompany debt into Equity
Proposed dividend related to 2022
Changes in equity
Comprehensive income for the year
Other comprehensive income, net of tax
-57
-57
Profit/loss for the year
Total comprehensive income for the year
Equity at 31 December 2022
During 2022, the parent company Eitzen Avanti AS converted intercompany debt of USD 3.4 million to equity in
Christiania Shipping A/S.
22
Consolidated statement of cash flow
1 January - 31 December
USD '000
Note
2023
2022
Operating profit (EBIT)
Adjustment for depreciation
8
Adjustment for gains/losses from impairment of fixed assets
8, 12
-40.688
Adjustment for gains/losses from sale of fixed assets
8
-1.126
Change in working capital excl. Accrued interest and tax liabilities
22
-10.137
Interest received
9
Interest paid
10
-3.633
-2.242
Interest on lease paid
10
-1.039
-1.604
Interest on finance arrangements paid
10
-2.338
-1.513
Tax paid
-23
-20
Cash flow from operating activities
Additions of tangible assets
12
-33.082
-42.877
Excecuting of purchase option
-2.625
Proceeds from the sale of tangible assets
Cash flow from investing activities
-33.082
-42.602
Loan raised
19
Establishment costs for new loan
-192
-398
Loans to parent company
-23.000
-5.623
Sale and leaseback transactions
20
Repayment of lease liability
13
-932
-1.269
Repayment of finance agreements
20
-3.606
-1.714
Other financial assets
-8.259
Purchase of treasury shares
-5
Loans from related parties
-260
Loans from parent company
Repayment of loans
-1.667
-29.147
Hedges
-1.728
Deposit related to new loan facility
-250
-250
Cash flow from financing activities
-12.846
Net cash flow
-1.663
Cash and cash equivalents at beginning of the year
Exchange rate adjustments
-782
Net cash flow
-1.663
Cash and cash equivalents at end of the year
23
Notes to the consolidated financial statements
24
Note 1. Basis of preparation
This note provides a list of accounting policies adopted
in the preparation of the Consolidated Financial
Statements.
Christiania Shipping operates chemical tankers between
3,500 - 13,000 dwt and has a leading position in trade
niches in the Atlantic Ocean, Europe, West Africa and
the Mediterranean.
Christiania Shipping A/S is a Limited Liability Company
with its registered office in Denmark.
Principal accounting policies
The annual report for the period 1 January – 31
December 2023 with comparative figures comprises the
consolidated financial statements of Christiania
Shipping A/S (the Group) and its subsidiaries.
Consolidation principles
The consolidated financial statements of Christiania
Shipping A/S for 2023 have been prepared on a going
concern basis and in accordance with IFRS Accounting
Standards as adopted by the European Union and
additional Danish disclosure requirements for the
financial statements of reporting class large C
enterprises in accordance with the Danish Financial
Statements Act.
The consolidated financial statements are presented in
United States Dollars (USD). The consolidated financial
statements are presented on the basis of historical cost
prices. USD/DKK exchange rate at 31 December 2023
at 6,74 (6,97 at 31 December 2022).
Applied accounting policies are also included in note 28.
Accounting standards and interpretations not yet adopted
Certain new accounting standards and interpretations
have been published that are not mandatory for 31
December 2023 reporting period and have not been
early adopted by the Group. These standards are not
expected to have a material impact on the entity in the
current or future reporting periods and on foreseeable
future transactions.
25
Note 2. Significant accounting estimates, assumptions and uncertainties
In applying the Group’s accounting policies described in
note 1 and note 28, Management is required to make
estimates, as well as assumptions for the carrying
amount of assets and liabilities that cannot be directly
derived from other sources. These estimates and
assumptions are based on historical experience and
other relevant factors. The actual outcome may differ
from these estimates.
Estimates and underlying assumptions are reviewed on
an ongoing basis. Changes to accounting estimates are
recognised in the accounting period in which the change
takes place and in future accounting periods if the
change affects both the period during which the change
takes place and subsequent accounting periods.
Significant accounting estimates associated
with accounting policies
In connection with the application of the accounting
policies described in note 28, Management has made
the following accounting estimates, with a significant
effect on the amounts recognised:
• Voyage revenues and costs
• Impairment of tangible assets (including reversal
of impairments)
Voyage revenues and costs
Estimated voyage revenues and costs are recognised in
accordance with the percentage of completion method
with operating revenues and expenses recognised for
each voyage. The percentage of completion is estimated
by management based on the ratio between the
duration of the voyage from load date through the
balance sheet date relative to the total duration of
voyage through the estimated date of discharge.
Applied estimates are reviewed and updated at the end
of each accounting period.
Impairment of tangible assets (including
reversal of impairments)
The Group evaluates the carrying amount of vessels and
other net assets to determine whether events have
occurred, impairment indicators, that would require an
adjustment to the recognised value of the net assets. If
impairment indicators exist Management prepares an
impairment test. Impairment tests are based on
discounted future cash flow models, which are
compared to the carrying amount of the assets within
the cash generating units. Impairment tests are
prepared based on assumptions including future freight
rates, earnings from vessels and Management activities
as well as discount rates. All of these factors have been
historically volatile.
26
Note 3. Revenue
Accrued income included in trade receivables in the balance sheet constitutes contract assets comprising unbilled
amounts to customers representing the Group’s right to consideration for the services transferred to date. Any amount
previously recognised as accrued income is reclassified to trade receivables at the time it is invoiced to the customer.
Part of the deferred income presented in the balance sheet constitutes contract liabilities which represent advance
payments and billings in excess of revenue recognised.
There were no significant changes in accrued income and deferred income during the reporting period.
Note 4. Voyage related expenses
27
Note 5. Staff costs
Average employees
2023
2022
Land based employees
24
22
Seafarers
247
211
28
Note 6. Sharebased payment
In December 2022, Christiania Shipping entered into an agreement regarding granting shares in the parent company,
Eitzen Avanti AS, to its employees. Such scheme was approved by shareholders at a Board Meeting dated 9 March 2022.
Each share of nominal NOK 0.13 has a market value of NOK 10.55 on the day of the grant. All Christiania Shipping
permanent employees who was employed by the Group as of the grant date are eligible to participate in the scheme.
Employees may select not to participate in the scheme.
Shares issued by the Group are acquired on-market prior to the issue. Shares held by the Group and not yet issued to
employees at the end of the reporting period are shown as treasury shares in the financial statements.
Under the scheme, eligible employees may be granted up to one months salary worth of fully paid ordinary shares in
Eitzen Avanti AS for no cash consideration. The number of shares issued to the participants in the scheme is the offer
amount divided by the weighted average price of the market value on the grant date and as part of employee benefit
costs in the period the shares are granted.
There are no restrictions applied to the shares.
Each participant was issued shares worth a monthly salary. The shares had a grant date fair value of USD 181.324.
Note 7. Fees to the auditor appointed at the general meeting
Note 8. Depreciations, impairments and gains/losses
29
Note 9. Financial income
Note 10. Financial expenses
Note 11. Tax
The majority of the Group's income tax base is located in Denmark, and therefore subject to the Danish tonnage tax
scheme. The Group renewed its participation in the tonnage tax scheme on 1 January 2021, with a binding period of 10
years.
The Group did not own any vessels upon entering the tonnage tax scheme; consequently, the Group has no deferred,
or contingent, taxes from the transitional period.
Under the tonnage tax scheme, income and expenses from shipping activities are not subject to direct taxation and
accordingly an effective rate reconciliation has not been provided as it would not provide any meaningful information.
Instead, the taxable income is calculated from:
• The net tonnage of the vessels used to generate the income from shipping activities
• A rate applicable to the specific net tonnage of the vessel based on a sliding scale
In 2023, the Group have recognised a deferred tax asset of USD 172 thousand (2022: USD 110 thousand). There are
no unrecognised tax liabilities associated with investments in foreign subsidiaries and jointly controlled companies.
30
Note 12. Property, plant and equipment
During 2023, one vessel was acquired from an external party and two vessels were acquired from a related party on
market terms in the vessel-owning company Christianiaship A/S.
During 2023, two vessels have been sold to third parties with repurchase options and obligations. Christiania Shipping
entered into lease contracts at the same time. These transactions have been treated as financing transactions on group
level.
31
During 2022, all Christiania Shipping’s own vessels was moved to a newly established subsidiary, Christianiaship A/S
based on booked values. On a Group level, this transaction has no impact to the carrying amount of the owned vessels.
Moreover, during 2022 one vessel was sold to an external party and two vessels was acquired in the vessel-owning
company Christianiaship A/S.
During 2022, three vessels have been sold to third parties with repurchase options and obligations. Christiania Shipping
entered into lease contracts at the same time. These transactions have been treated as financing transactions.
Please refer to note 28 for further information.
Impairment test
According to the Group’s accounting policy, a write-down is made to the higher of the sales price (less costs to sell) and
the value in use if there is an impairment indication.
As of 31 December 2023, Management assessed if any impairment indication exists for the Group’s fleet. The fleet,
including vessels chartered on time charter and bareboat charter agreements, is seen as one cash-generating unit (CGU).
Following the assessment, Management has assessed that there is no impairment indication.
The demand for chemical vessels was weak for several years due to periods of oversupply of chemical vessels as well as
the general impact of covid worldwide. At the end of 2021 there was a gradual market recovery which continued and
into a firm market recovery in 2022 and 2023.
As of 31 December 2023, Management assessed if any indications for reversal of impairments exists for the vessels in
the Group’s fleet which carries previously recognised impairment losses. An impairment test was performed at the end
of 2023 in order to assess potential reversal of previously recognised impairment.
The vessels which carries previously recognized impairment losses is defined as separate CGUs. A WACC of 9% was
used for the calculation.
The value-in-use calculation indicated substantial headroom and prior year impairments of USD 40.7 million were
reversed. The value-in use calculation is particularly sensitive to even minor fluctuations in freight rates and WACC. As
an example of these sensitivities, a reduction of the assumed freight rates of USD 1,000 per day would affect the value-
in-use negatively by approximately USD 17.9 million. An increase in WACC of 1% would similarly affect the value-in-use
negatively by approximately USD 1.6 million.
32
Note 13. Leases
The total cash outflow for leases in 2023 was USD 2.0 million (2022: USD 2.9 million).
The Group’s leasing activities primarily consists of bareboat charter leases, which have a duration of up to ten years.
Leasing arrangements are accounted for as described in note 28.
33
Note 14. Other financial assets
The Group has invested in two newbuildings to be delivered in 2025 and 2026. The Group will pay for the two first
installments, while the remaining installments are financed through sale and leaseback arrangements with purchase
options and purchase obligations.
Other financial assets amounted to USD 8.3 million as of 31 December 2023, reflecting the first installments on above
mentioned newbuildings.
The newbuilding contract is in JPY while the financing is in USD. In order to hedge the currency exposure, the Group has
acquired a USD / JPY option. As per 31 December 2023, derivatives amounted to USD 1.2 million.
Note 15. Trade receivables
The fair value of trade receivables approximates the carrying amount.
A provisioning account is used to reduce the carrying amount of receivables from sales and services whose value is
impaired due to loss risk.
The Group applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits
34
the use of the lifetime expected loss provision for all trade receivables. To measure the expected credit losses, trade
receivables have been grouped based on shared credit risk characteristics and the days past due. The expected credit
losses also incorporate forward looking information. The credit risk is generally considered immaterial.
The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty
and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation or has entered
into bankruptcy proceedings.
Note 16. Prepayments
Note 17. Cash and cash equivalents
35
Note 18. Share capital
Note 19. Loans
During 2023, the Group amended the existing loan agreement. The fair value of the loans approximates the carrying
amount. The loan agreement, signed in December 2023, includes financial covenants with respect to liquidity, equity
ratio and working capital requirements. These requirements were met at the balance sheet date.
Note 20. Financing arrangements
In 2023, the Group has entered into sale-and-leaseback agreements. The Group has purchase options for the vessels
and when the financing expires, the Group has a purchase obligation to acquire the vessels at an agreed value. The
following finance arrangements have been established during 2023:
• The Group entered into a finance arrangement with White Line Co. on 19 September 2023 to finance USD 9.0
million in connection with the sale-and-leaseback of Alice Theresa.
• The Group entered into a finance arrangement with Libero Panama S.A. on 29 November 2023 to finance USD
8.0 million in connection with the sale-and-leaseback of Tina Theresa.
36
In accounting for a financing arrangement, the Group continues to recognise the transferred assets and recognises a
financial liability for the consideration received from lender. The financial liability is subsequently measured at amortized
cost.
Note 21. Trade payables
Note 22. Changes in working capital
Note 23. Unrecognised contingent assets and liabilities
The Group is not involved in any material lawsuits involving claims against the Group. However, claims have been made
against the Group regarding cargo claims etc. It is Management’s opinion that the outcome of these disputes will not
have any material impact on the Group’s financial position, result or cash flow.
The Group is not involved in any material lawsuits, disputes etc. involving claims from the Group against third parties.
The Group has not issued any guarantees.
37
Note 24. Mortgages and security
The assets mortgaged as security relates to a loan facility of USD 35.9 million (2022: USD 37.6 million). The loan expires
in July 2027, or when the vessels being mortgaged are disposed of, if earlier.
Note 25. Related party disclosures and transactions with related parties
Related parties with controlling influence
Related parties with controlling influence consist of the Board in Eitzen Avanti AS, based in Oslo, Norway that ultimately
controls the Group with 100% ownership.
Transactions with related parties
The related parties comprise the Executive Board, members of the Board of Directors, as well as their close relatives.
Related parties also include companies in which the above-mentioned persons have significant interests as well as
companies and foundations, which have direct or indirect considerable influence through shareholding. Remuneration to
key management personnel are disclosed in note 5.
The following balances are outstanding at the end of the reporting period in relation to transactions with related
parties:
During the year, the Group has paid time charter hire to RF Tankers AS of USD 6.8 million (2022: USD 4.1 million).
38
Note 26. Financial risks
Due to the nature of Christiania Shipping’s operations, the Group is mainly exposed to risks relating to fluctuations in
freight rates and bunker prices.
Maturities of financial liabilities
The table below analyses the Group’s financial liabilities into relevant maturity groupings:
Freight rates
The Group’s income is principally generated from voyages carried out by its fleet of vessels. As such the Group is exposed
to volatility in the freight rates.
It is the Group’s strategy to minimize its’ to this risk by entering physical contacts with different duration, such as cargo
contracts and time charters.
All things being equal and the extent the Group’s vessels have not already been chartered out at fixed rates, a freight
rate change of 1% would lead to the changes in profit and loss as shown above.
There have been no changes in the methods applied from previous periods.
39
Bunker prices
The Group’s largest variable cost is fuel in the form of bunkers, and the total cost will therefore depend on the market
price of bunkers. To reduce this risk the Group generally entering physical delivery contracts which make it possible to
levy any changes in the bunker prices on the customer.
All things being equal, a price increase of 1% per ton of bunker oil (without subsequent changes in freight rates) would
lead to the changes in profit and loss as shown above.
There have been no changes in the methods applied from previous periods.
Categories of financial instruments
The carrying amounts for the Group’s financial instruments are shown below:
40
Note 27. Subsequent events
5 March 2024 Christiania Shipping acquired Sigaia Theresa from the BB owners.
28 April 2024 Christiania Shipping took delivery of the 12,000 dwt stainless steel 2019 built vessel Julia Theresa on a
10 year BB agreement.
14 May 2024 Christiania Shipping sold the 2009 built 8,000 dwt vessel Annelise Theresa.
31 May 2024 the shares in Christiania Shipping A/S was contributed to Christiania Holding A/S as a non-cash
contribution.
4 June 2024 Christiania Shipping sold the 2009 built 13,000 dwt vessel Diana Theresa.
41
Note 28. Accounting policies
Accounting policies in addition to those described in
note 2, is as described below.
Consolidated financial statements
The consolidated financial statements include
Christiania Shipping A/S (parent company) and the
enterprises (subsidiaries) which are controlled by the
parent company. Control is achieved when the
company:
• has the power of the investee
• is exposed or has the right to variable returns
from involvement with the investee
• has the ability to use its power to affect its
returns
The Group’s joint control or significant influence over an
entity or activity is subject to an assessment of power
and exposure to variability in returns. When assessing
joint control, an analysis is carried out to determine
which decisions require unanimity and whether these
concern the activities that significantly affects return.
Joint control is the contractually agreed sharing of
control of an arrangement, which exists only when
decisions about the relevant activities require the
unanimous consent of the parties sharing control.
Basis of consolidation
The consolidated financial statements have been
prepared on the basis of the accounts of Christiania
Shipping A/S and its subsidiaries. The consolidated
financial statements have been prepared by adding
together items of a uniform nature. The accounts used
for consolidation purposes have been prepared in
accordance with the Group’s accounting policies.
Intercompany income and expenses, intercompany
balances and dividends as well as profit and loss from
intercompany transactions have been eliminated on
consolidation. Subsidiaries’ items are recognised in full
in the consolidated financial statements. Non-
controlling interests, presented as part of equity,
represent the portion of a subsidiary’s profit or loss and
net assets that is not held by the Company.
Investments in joint arrangements are recognised and
measured in the consolidated financial statements pro
rata with the Group’s ownership interest and presented
on a line-by-line basis in the consolidated financial
statements. The proportionate share of the results of
the entities after tax and elimination of unrealised
proportionate intercompany profits and losses is
recognised in the income statement.
Foreign currency translation
The functional currency and presentation currency of
the Group is USD. On initial recognition, transactions in
currencies other than the functional currency of the
Group are translated using the exchange rate at the
date of the transaction. Receivables, payables and other
monetary items in foreign currencies, which have not
been settled at the balance sheet date, are translated
using the rate of exchange at the balance sheet date.
Any exchange differences arising between the rate of
exchange at the date of the transaction and the rate of
exchange at the date of payment and the balance sheet
date, respectively, are recognised in the income
statement as financial income and expenses. Property,
plant and equipment, intangibles, inventories and other
non-monetary assets purchased in foreign currencies
and measured using historical costs are translated using
the rate of exchange at the date of the transaction.
Income statement
Revenue
Revenue comprises freight, demurrage, time charter
and other voyage related revenue. Revenue is
recognised when or as performance obligations are
satisfied by transferring the promised goods or services
to the customer, i.e. at a point in time or over time
provided that the stage of completion can be measured
reliably. Revenue is measured at the consideration the
Group expects to be entitled to.
The completion is determined using the load-to-
discharge method based on the percentage of the
estimated duration of the voyage completed at the
reporting date. Freight revenue and related voyage and
operating costs are recognized in the income statement
according to the entered charter parties from the date
of load to the date of delivery of the cargo (discharge).
42
Accordingly, freight, charter hire and demurrage
revenue are recognised at selling price upon delivery of
the service as specified in the agreement with the
charter parties.
Voyage related expenses
These are expenses related to voyages performed by
the Groups vessels. Voyage related expenses consist
mainly of bunkers, port expenses and commissions.
Voyage related expenses are recognised as incurred.
Operating expenses
Operating expenses include costs relating to the
operation and maintenance of vessels, including costs
relating to crew. Operating expenses are recognised as
incurred.
Administrative expenses
Administrative expenses include the cost of offices,
personnel costs and administrative costs. Staff costs
comprise wages and salaries, social security and
pension costs, etc. and are recognised as incurred.
Depreciation and impairment losses
Depreciation and impairment losses comprise
depreciation of tangible fixed assets for the period as
well as the impairment of the value of assets by the
amount by which the carrying amount of the asset
exceeds its recoverable amount. In the event of
indications of impairment, the carrying amount is
assessed, and the value of the asset is impaired to its
recoverable amount equal to the higher of value in use
based on net present value of future earnings from the
assets and its net selling price.
Financial items
Financial items comprise interest income and expenses,
realised and unrealised gains and losses on securities,
liabilities and foreign currency transactions, dividends,
estimated interest expenses relating to amortization
allowances or deductions relating to mortgage debt etc.
as well as surcharges and allowances under the Danish
Corporate Tax Scheme.
Interest income and expenses are accrued on the basis
of the principal and the effective interest rate. The
effective interest rate is the discount rate that will be
used to discount the expected future payments that are
linked to the financial asset or financial liability so that
their present value corresponds to the carrying amount
of the asset and liability.
Tax
The Group’s current tax of the year consists of
estimated tax according to the Danish Tonnage Tax Act
for all shipping activities, and according to general tax
regulations for net financial income and other activities.
Other activities consist of the Group’s Management fee
income. Shipping activities are taxed based on the net
tonnage (vessels) which the Group has at its disposal.
Based on the Group’s planned use of vessels and
recovery of reversed depreciation, the tonnage tax
regime does not result in a deferred tax liability, but is
merely incorporated as a contingent liability. Other
activities of the Group are not subject to deferred tax
either.
Balance sheet
Property, plant and equipment, vessels and dry-
docking
Property, plant and equipment, vessels, upgrade costs,
dockings and office and IT equipment, and are
measured at cost less accumulated depreciation and
impairment losses. The cost comprises the cost of
acquisition and any expenses directly related to the
acquisition until the time when the asset is ready for
use, including interest expenses incurred during the
period of construction. Other borrowing costs are taken
to the income statement. Depreciation is charged over
the expected economic lives of the assets, and the
depreciation methods, expected lives and residual
values are reassessed individually for the assets at the
end of each financial year.
Vessels
Vessels are measured at cost less accumulated
depreciation and write-downs. All major components of
vessels except for dry-docking assets are depreciated
on a straight-line basis to the estimated residual value
over their estimated useful lives, which the Group
estimates to be 25 years. Depreciation is based on cost
43
less estimated residual value. Residual value is
estimated as the light weight tonnage of each vessel
multiplied by scrap value per ton. The useful life and
residual value of the vessels are reviewed at least at
each financial year-end based on market conditions,
regulatory requirements and the Group’s business
plans. Moreover, the Group evaluates the carrying
amount of the vessels to determine whether events
have occurred that indicate impairment and would
require an adjustment of the carrying amounts.
Prepayments on vessels under construction are
recognised as installments paid.
Dry-dockings
Vessels are required to undergo planned dry dockings
for major repairs and maintenance, which cannot be
carried out while the vessels are operating. Dry-
dockings are generally required every 30-60 months
depending on the nature of the work, and the age of the
vessel. Costs relating to dry-dockings are capitalised
and depreciated on a straight-line basis over a period of
60 months or to the next dock if within 30 months. The
residual value is estimated at zero. A portion of the cost
of acquiring a new vessel is allocated to the components
which are expected to be replaced or refurbished at the
next dry-docking. A portion of the acquisition price for
a new vessel is allocated to a dry-docking asset. The
dry-docking asset is estimated on the basis of the
expected costs related to the first-coming docking,
which is based on experience with similar vessels. At
subsequent measurement dry-dockings, the asset
comprises the actual docking costs incurred.
Office and IT equipment
Office and IT equipment is depreciated on a straight-
line basis over the estimated useful lives, which does
not exceed 5 years.
Leases
The Group leases vessels through bareboat and time
charter arrangements. Contracts may contain both
lease and non-lease components. The Group allocates
the consideration in the contract to the lease and non-
lease components based on their relative stand-alone
prices.
Leases are recognised as a right-of-use asset and a
corresponding liability at the date at which the leased
asset is available for use by the Group.
Lease liabilities
Lease liabilities are initially measured on a present value
basis and include the following lease payments:
• fixed payments (including in-substance fixed
payments), less any lease incentives receivable
• variable lease payments that are based on an
index or a rate, initially measured using the index
or rate as at the commencement date
• amounts to be expected to be payable by the
Group under residual value guarantees
• the exercise price of a purchase option if the
Group is reasonably certain to exercise that
option
• payments of penalties for terminating the lease,
if the lease term reflects the Group exercising
that option
• payments to be made under reasonably certain
extension options
In calculating the present value of the lease payments,
Christiania Shipping uses the incremental borrowing
rate at the lease commencement date. This is the rate
the Group would have to pay to borrow the funds
necessary to obtain an asset of similar value to the
right-of-use asset in a similar economic environment
with similar terms, security and conditions. The
incremental borrowing rate applied is approximately
8%. 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.
The Group is exposed to potential future increases in
variable lease payments based on an index or rate,
which are not included in the lease liability until they
take effect. When adjustments to lease payments based
on an index or rate take effect, the lease liability is
reassessed and adjusted against the right-of-use asset.
Lease payments are allocated between principal and
finance expenses. Finance expenses are charged to the
44
income statement over the lease period so as to
produce a constant periodic rate of interest on the
remaining balance of the liability for each period.
Right-of-use assets
Right-of-use assets are measured at cost comprising
the following:
• the amount of the initial measurement of lease
liability
• any lease payments made at or before the
commencement date less any lease incentives
received
• any initial direct costs
• restoration costs
Right-of-use assets are depreciated over the lease term
on a straight-line basis.
Payments associated with short-term leases of
equipment and vehicles and all leases of low-value
assets are recognised on a straight-line basis as an
expense in profit or loss. Short-term leases are leases
with a lease term of 12 months or less. Low-value
assets comprise rent of the Group head quarter and
office equipment etc.
Sale and leaseback transactions
A sale-and-leaseback transaction involves the transfer
of an asset by an entity (the seller-lessee) to another
entity (the buyer-lessor) and the leaseback of the same
asset by the seller-lessee. However, in order for an
arrangement to be classified as a sale-and-leaseback
agreement, the Group is required to apply IFRS 15
Revenue from Contracts with Customers to determine
whether a sale has occurred. That is, control of the
underlying asset has to pass to the buyer-lessor in order
for the arrangement to be classified as a sale-and-
leaseback agreement. If control of the underlying asset
is not passed, the transaction should be accounted for
as a financing transaction.
In case, the Group’s option (and obligation) to
repurchase the vessels means that the transaction does
not qualify as a sale in accordance with IFRS 15 and
therefore does not qualify as a sale and leaseback.
Consequently, the Group should account for the
transaction as a financing arrangement in accordance
with IFRS 9 Financial instruments.
In accounting for a financing arrangement, the Group
continues to recognise the transferred assets and
recognises a financial liability for the consideration
received from the buyer-lessor. The financial liability is
subsequently measured at amortized cost.
Impairment tests
The carrying amounts of property, plant and equipment
with finite useful lives are evaluated at the balance
sheet date to determine whether there are indications
of impairment. If an indication of impairment is
identified, the recoverable amount of the asset is
estimated in order to determine the need for
recognising an impairment loss and the extent hereof.
If an asset does not generate cash flows that are
independent from other assets, the recoverable amount
is determined for the smallest cash-generating unit to
which the asset belongs. The Group is considered as one
cash generating unit. The recoverable amount is defined
as the higher of the fair value of the asset or the cash
generating unit less costs to sell and the value in use.
In assessing value in use, the estimated future cash
flows are discounted to their present value using a
discount rate that reflects current market assessments
of the time value of money, the risks specific to the
asset or the cash-generating unit for which the
estimates of future cash flows have not been adjusted.
For vessels, the fair value is usually determined based
on the estimated selling price less costs to sell. If the
recoverable amount of the asset or cash-generating unit
is estimated to be less than its carrying amount, the
carrying amount is reduced to the recoverable amount.
An impairment loss for cash-generating units is
allocated to the assets of the unit, but no asset will be
reduced to a lower value than its fair value deducted
expected costs to sell. Impairment losses are
recognised in the statement of comprehensive income.
If an impairment loss subsequently is reversed as a
result of changes in the assumptions used to determine
the recoverable amount, the carrying amount of the
asset or cash-generating unit is increased to the revised
45
recoverable amount, but so that the increased carrying
amount does not exceed the carrying amount that
would have been determined had no impairment loss
been recognised for the asset or cash-generating unit.
Assets that suffered an impairment are reviewed for
possible reversal of the impairment at the end of each
reporting period.
Derivatives and hedging activities
Derivatives are initially recognised at amortised cost on
the date a derivative contract is entered into and are
subsequently remeasured to their fair value at the end
of each reporting period. The accounting for subsequent
changes in fair value depends on whether the derivative
is designated as a hedging instrument, and if so, the
nature of the item being hedged.
The Group designates hedging instruments as hedges
of highly probable forecast transactions in foreign
currency (cash flow hedges).
The effective portion of changes in the fair value of
derivatives that are designated and qualify as cash flow
hedges is recognised in other comprehensive income
and accumulated in Reserve for cash flow hedges in
equity. The gain or loss relating to the ineffective
portion is recognised immediately in profit or loss within
financial items.
Inventories
Inventories are measured at cost according to the FIFO
method, or net realizable value if lower. Inventories
consist of bunkers and lubricants etc. The cost of
bunkers and lubricants includes the purchase price and
delivery costs.
Receivables
Receivables comprise trade receivables (including
accrued income) and other receivables. Receivables are
classified as receivables that are financial assets, with
fixed or determinable payments, which are not quoted
in an active market and which are not derivative
financial instruments. Receivables are initially
measured at fair value and subsequently at amortized
cost, which usually equals the nominal value less
provisions for bad debts.
In measuring the expected credit losses on trade
receivables, the Group applies the simplified approach
permitted by IFRS 9, which requires expected lifetime
losses to be recognised from initial recognition of the
receivables.
Dividends
Dividend are recognised as a liability at the time of
approval by the General Meeting. Dividends proposed
by Management in respect of the year are stated under
equity.
Provisions
Provisions are recognised when the Group has a legal or
constructive obligation as a result of past events, for
which it is probable that an outflow of resources
embodying economic benefits will be required to settle
the obligation. Provisions are measured as the best
estimate of the expenditure required to settle the
obligation at the balance sheet date. Provisions with an
expected maturity of more than one year from the
balance sheet date are measured at present value.
Non-current and current financial liabilities
(interest bearing debt)
Finance loans are initially measured at fair value less
any transaction costs. Finance loans are subsequently
measured at amortized cost. This means that the
difference between the amount on initial recognition
and the redemption value is recognised in the income
statement as a financial expense over the term of the
loan using the effective interest method.
Trade payables and other liabilities
Trade payables and other liabilities are initially
measured at fair value less any transaction costs.
Liabilities are subsequently measured at amortized cost
using the effective interest method. Accordingly, the
difference between the proceeds and the nominal value
is recognised in the in-come statement as a financial
expense over the term of the liability.
46
Cash flow statement
The cash flow statements are presented using the
indirect method and show cash flows from operating,
investing and financing activities as well as cash and
cash equivalents at the beginning and end of the year.
Cash flows from operating activities are stated as the
operating profit or loss, adjusted for non-cash operating
items and changes in working capital, less corporation
tax paid attributable to operating activities.
Cash flows from investing activities include payments in
connection with the acquisition and divestment of
enterprises and financial assets and the acquisition,
development, improvement and sale, etc. of intangibles
and property, plant and equipment.
Cash flows from acquisition and divestment of
enterprises are shown separately under cash flows from
investing activities. Cash flows from acquired
enterprises are recognised in the cash flow statement
from the time of their acquisition, and cash flows from
divested enterprises are recognised up to the time of
sale. Cash flows from financing activities comprise
changes in the parent Group’s share capital and related
costs as well as raising and repayment of loans,
instalments on interest bearing debt, acquisition of
treasury shares and payment of dividend. Cash flows in
other currencies than the functional currency are
recognised in the cash flow statement using average
exchange rates for the respective months, unless these
deviate materially from the actual exchange rates ruling
at the dates of the transactions. If so, the actual
exchange rates are used.
Cash and cash equivalents
Cash and cash equivalents include cash in hand,
deposits held at call with banks, other short-term highly
liquid investments and bank overdrafts. Bank overdrafts
are shown within borrowings in current liabilities.
47
Parent company financial statements
Page
Parent company income statement .................................................................................................................. 48
Parent company balance sheet ........................................................................................................................ 49
Parent company statement of changes in equity ................................................................................................ 51
Parent company statement of cash flow .......................................................................................................... 52
Notes to the parent company financial statements ............................................................................................. 53
48
Parent company income statement
1 January - 31 December
49
Parent company balance sheet
at 31 December
50
Parent company balance sheet
at 31 December
51
Parent company statement of changes in equity
1 January - 31 December 2023
1 January - 31 December 2022
During 2022, the parent company Eitzen Avanti AS converted intercompany debt of USD 3.4 million to equity in
Christiania Shipping A/S.
52
Parent company statement of cash flow
1 January - 31 December 2023
53
Notes to the parent company financial statements
54
Note 1. Basis of preparation
The parent company’s annual report for the period 1
January – 31 December 2023 with comparative figures
comprises the financial statements of Christiania
Shipping A/S (‘the Company’).
The parent company’s financial statements are
prepared in accordance with the International Financial
Reporting Standards (IFRS) as adopted by the European
Union and additional requirements from the Danish
Financial Statements Act. Christiania Shipping A/S is a
Limited Liability Company with its registered office in
Denmark.
The Parent Company uses the same accounting policies
for recognition and measurement as the Group. In such
case, where the Parent Company’s accounting policies
differ from the Group, those are described below. For a
detailed description of the Parent Company’s accounting
policies, see note 28 in the Consolidated Financial
Statements.
The financial statements are presented in United States
Dollars (USD). The financial statements are presented
on the basis of historical cost prices.
Results from investments in subsidiaries
Results from investments in subsidiaries comprises the
individual entities’ earnings after full elimination of
internal gains and losses.
Conversion of foreign currency
Exchange rate adjustments of receivables from or
liabilities to subsidiaries, which are considered part of
the parent company's investment in the subsidiary, are
recognised in the income statement under financial
items. In the consolidated financial statements, value
adjustments are recognised in other comprehensive
income.
Investment in subsidiaries
Investments in subsidiaries are recognised and
measured according to the equity method.
The total net revaluation of investments is subsidiaries
is transferred through the distribution of profits to
“Reserve for net revaluation according to equity
method” under equity. The reserve is reduced by
dividend payments to the parent company and is
adjusted with other changes in equity in subsidiaries.
Subsidiaries with negative net asset value are
recognised at USD 0, and a provision to cover the
negative balance is recognised if such a present
obligation for this purpose exists.
55
Note 2. Significant accounting estimates, assumptions and uncertainties
For a description of significant accounting estimates, assumptions and uncertainties, see note 2 of the consolidated
financial statements.
Note 3. Revenue
See note 3 in the consolidated financial statements.
Note 4. Voyage related expenses
See note 4 in the consolidated financial statements.
Note 5. Staff costs
Average employees
2023
2022
Land based employees
18
16
Seafarers
247
211
265
227
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Note 6. Sharebased payment
In December 2022, Christiania Shipping entered into an agreement regarding granting shares in the parent Company,
Eitzen Avanti AS, to its employees. Such scheme was approved by shareholders at a Board Meeting dated 9 March 2022.
Each share of nominal NOK 0.13 has a market value of NOK 10.55 on the day of the grant. All Christiania Shipping
permanent employees who was employed by the Company as of the grant date are eligible to participate in the scheme.
Employees may select not to participate in the scheme.
Shares issued by the Company are acquired on-market prior to the issue. Shares held by the Company and not yet
issued to employees at the end of the reporting period are shown as treasury shares in the financial statements.
Under the scheme, eligible employees may be granted up to one months salary worth of fully paid ordinary shares in
Eitzen Avanti AS for no cash consideration. The number of shares issued to the participants in the scheme is the offer
amount divided by the weighted average price of the market value on the grant date and as part of employee benefit
costs in the period the shares are granted.
There are no restrictions applied to the shares.
Each participant was issued shares worth a monthly salary. The shares had a grant date fair value of USD 138.183.
57
Note 7. Fees to the auditor appointed at the general meeting
See note 7 in the consolidated financial statements.
Note 8. Depreciations, impairments and gains/losses
Note 9. Share of results in subsidiaries
Note 10. Financial income
Note 11. Financial expenses
58
Note 12. Tax
The majority of the Company's income tax base is located in Denmark, and therefore subject to the Danish tonnage tax
scheme. The Company renewed its participation in the tonnage tax scheme on 1 January 2021, with a binding period of
10 years.
The Company did not own any vessels upon entering the tonnage tax scheme; consequently, the Company has no
deferred, or contingent, taxes from the transitional period.
Under the tonnage tax scheme, income and expenses from shipping activities are not subject to direct taxation and
accordingly an effective rate reconciliation has not been provided as it would not provide any meaningful information.
Instead, the taxable income is calculated from:
• The net tonnage of the vessels used to generate the income from shipping activities
• A rate applicable to the specific net tonnage of the vessel based on a sliding scale
In 2023, the Company have recognised a deferred tax asset of USD 161 thousand (2022: USD 108 thousand). There
are no unrecognised tax liabilities associated with investments in foreign subsidiaries and jointly controlled companies.
Note 13. Property, plant and equipment
59
During 2022, all Christiania Shipping’s own vessels was moved to a newly established subsidiary, Christianiaship A/S
based on booked values. Moreover, during 2022 one vessel was sold to an external party.
During 2022, three vessels have been sold to third parties with repurchase options and obligations. Christiania Shipping
entered into lease contracts at the same time. These transactions have been treated as financing transactions.
Please refer to note 28 in the consolidated financial statements for further information.
Impairment test
According to the Company’s accounting policy, a write-down is made to the higher of the sales price (less costs to sell)
and the value in use if there is an impairment indication.
As of 31 December 2023, Management assessed if any impairment indication exists for the Company’s fleet. The fleet,
including vessels chartered on time charter and bareboat charter agreements, is seen as one cash-generating unit (CGU).
Following the assessment, Management has assessed that there is no impairment indication.
The demand for chemical vessels was weak for several years due to periods of oversupply of chemical vessels as well as
the general impact of covid worldwide. At the end of 2021 there was a gradual market recovery which continued and
into a firm market recovery in 2022 and 2023.
As of 31 December 2023, Management assessed if any indications for reversal of impairments exists for the vessels in
the Company’s fleet which carries previously recognised impairment losses. An impairment test was performed at the
end of 2023 in order to assess potential reversal of previously recognised impairment.
60
The vessels which carries previously recognized impairment losses is defined as separate CGUs. A WACC of 9% was
used for the calculation.
The value-in-use calculation indicated substantial headroom and prior year impairments of USD 7.3 million were
reversed. The value-in use calculation is particularly sensitive to even minor fluctuations in freight rates and WACC. As
an example of these sensitivities, a reduction of the assumed freight rates of USD 1,000 per day would affect the value-
in-use negatively by approximately USD 4.6 million. An increase in WACC of 1% would affect the value-in-use negatively
by approximately USD 0.1 million.
Note 14. Leases
The total cash outflow for leases in 2023 was USD 2.6 million (2022: USD 2.9 million).
The Company’s leasing activities primarily consists of bareboat charter leases, which have a duration of up to ten years.
Leasing arrangements are accounted for as described in note 28 in the consolidated financial statements.
61
Note 15. Other financial assets
See note 14 in the consolidated financial statements.
Note 16. Investments in subsidiaries
*Christianiaship A/S was established on 20 June 2022.
Note 17. Trade receivables
The fair value of trade receivables approximates the carrying amount.
A provisioning account is used to reduce the carrying amount of receivables from sales and services whose value is
impaired due to loss risk.
62
The Company applies the simplified approach to providing for expected credit losses prescribed by IFRS 9, which permits
the use of the lifetime expected loss provision for all trade receivables. To measure the expected credit losses, trade
receivables have been grouped based on shared credit risk characteristics and the days past due. The expected credit
losses also incorporate forward looking information. The credit risk is generally considered immaterial.
The Company writes off a trade receivable when there is information indicating that the debtor is in severe financial
difficulty and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation or has
entered into bankruptcy proceedings.
Note 18. Prepayments
Note 19. Cash and cash equivalents
Note 20. Share capital
See note 18 in the consolidated financial statements.
63
Note 21. Financing arrangements
The Company has entered into sale-and-leaseback agreements. The Company has purchase options for the vessels and
when the financing expires, the Company has a purchase obligation to acquire the vessels at an agreed value.
In accounting for a financing arrangement, the Company continues to recognise the transferred assets and recognises
a financial liability for the consideration received from lender. The financial liability is subsequently measured at
amortized cost.
Note 22. Trade payables
Note 23. Changes in working capital
Note 24. Unrecognised contingent assets and liabilities
See note 23 in the consolidated financial statements.
The Parent company is guarantor for the loan facility in its subsidiary, Christianiaship A/S.
64
Note 25. Related party disclosures and transactions with related parties
See note 25 in the consolidated financial statements.
The following balances are outstanding at the end of the reporting period in relation to transactions with related
parties:
During the year, the Company has paid time charter hire to Christianiaship A/S of USD 32.2 million (2022: USD 15.8
million) and RF Tankers AS of USD 6.8 million (2022: USD 4.1 million).
Note 26. Financial risks
See note 26 in the consolidated financial statements.
Maturities of financial liabilities
The table below analyses the Company’s financial liabilities into relevant maturity groupings:
Categories of financial instruments
The carrying amounts for the Group’s financial instruments are shown below:
65
Note 27. Subsequent events
See note 27 in the consolidated financial statements.
66
E
xecutive Management
Board of Directors
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28 June 2024
CVR No 33 77 12 31
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Definitions and glossary
Non-GAAP measures
Time charter equivalent earnings = Net freight income – Voyage related expenses
71
Company information
Christiania Shipping A/S
Amerika Plads 38
2100 København Ø
Registration no. 40 53 35 16
www.christiania-shipping.com
Board of Directors and Management
BOARD OF DIRECTORS – Christiania Shipping A/S
• Axel Camillo Eitzen
Board member since January 2018, Chairman since January 2023
• Fridtjof Camillo Eitzen
Board member since December 2020
• Axel Stove Lorentzen
Board member since December 2020
KEY MANAGEMENT PERSONNEL
• Fridtjof Camillo Eitzen – Chief Executive Officer
Employed January 2023
• Snorre Schie Krogstad – Chief Financial Officer
Employed February 2022
• Torben Larsen – Chief Operational Officer
Employed January 2018
• Rune Eriksen Lorentsen – Chief Operating Manager
Employed April 2018
• Anne Sofie Reimann – Chief Accounting & Reporting Officer
Employed December 2023