Consolidated Financial Statements
Consolidated Statement of Cash Flows For the year ended December 31, 2009
1. ORGANIZATION AND OPERATIONS
directly chartered to “Odfjell” Company for the first six months of 2009 and are operating in a pool with Odfjell tanker for the second half of 2009, six are chartered to the International Shipping and Transportation Company Limited (ISTC), a subsidiary of Saudi Basic Industries Corporation (SABIC), and one tanker is chartered out to Saudi International Petrochemical Company (SIPCHEM). The Subsidiary signed a 50 percent joint venture agreement with “Odfjell SE” on June 15, 2009 to establish a company in Dubai, (United Arab Emirates), by the name of NCC-Odfjell Chemical Tankers JLT (hereinafter referred as “Joint Venture”), to commercially operate the two companies’ combined fleet of coated chemical tankers in a pool for trading in the chemicals, vegetable oils and clean petroleum products markets on a world-wide basis with emphasis on the growing production and export of the Arabian Gulf Region. The new company will commence operations in the beginning of 2010 with 15 vessels with total capacity of approximately 660,000 tons, which is expected to grow to 31 vessels with 1.4 million tons over the next three years. As of December 31, 2009, the Subsidiary contributed SR 153 thousand representing 50% of its ownership interest in the equity of the Joint Venture and also advanced a loan of SR 514 thousand repayable by July 15, 2010. Such loan carries no commission charges. The first financial period of the Joint Venture is from the date of its establishment (December 22, 2009) to December 31, 2010. Also in January 2009, the Subsidiary sold three of its old tankers (see Note 21).
The National Shipping Company of Saudi Arabia, a Saudi joint stock company (the “Company”), was established by Royal Decree No. M/5 dated 12/02/1398H, corresponding to 21/01/1978, and registered under Commercial Registration No. 1010026026 dated 01/12/1399H, corresponding to 22/10/1979, issued in Riyadh. The Company is primarily engaged in purchasing, chartering and operating vessels for the transportation of cargo and passengers and other activities related to sea shipping industry. The Company has operations through three distinct segments which are very large crude carriers (VLCCs), chemical transportation, and goods transportation (liners). The authorized capital of the Company is SR 3,150 million from 315 million shares for the nominal value of SR 10 each as of December 31, 2009 and 2008. The Company owns seventeen Very Large Crude Carriers (VLCCs), one of which is chartered to Vela International Marine Limited, a subsidiary of Saudi Aramco, two to Euronav Company, three to Hanjin Company (A Korean Company) and eleven are operating in spot market. The Company owns four Roll-On Roll-Off (RoRo) vessels operating on liner trade between North America, Europe, the Middle East and Indian Subcontinent. The National Chemical Carriers Ltd. Co. (“Subsidiary”) owns thirteen chemical tankers, out of which three were leased to Odfjell SE (“Odfjell”), a Norwegian company, on January 30, 2009 under a bareboat capital lease arrangement (see Note 6), three were
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Annual Report 2009 The National Shipping Company of Saudi Arabia
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