Chapter 5 Consolidated Financial Statements and Auditor’s Report for the year ended 31 December 2013
The National Shipping Company of Saudi Arabia (A Saudi Joint Stock Company) Notes To The Consolidated Financial Statements December 31, 2013 (In Thousands Saudi Riyals)
1. Organization and Operations The National Shipping Company of Saudi Arabia, a Saudi Joint Stock Company (“the Company”), was established by Royal Decree No. M/5 dated Safar 12, 1398H, corresponding to January 21, 1978G, and registered under Commercial Registration No. 1010026026 dated Dhul Hijjah 1, 1399H, corresponding to October 22, 1979G, issued in Riyadh.
of land and properties inside or outside the kingdom, ownership of shares in other existing companies or merge with them and participate with others in establishing companies with similar activities or complementary activities. The capital of the Company is SR 3,150 million, comprising 315 million shares with nominal value of SR 10 each as of December 31, 2013 and 2012.
The Company and its subsidiaries mentioned below (“the Group”) are primarily engaged in the purchase, lease, operation of vessels for transportation of cargo and passengers, and carry out all marine transport related activities. The Group performs its operations through four distinct segments which are transportation of crude oil and gas, chemicals, general cargo, and dry bulk. The Group is also engaged in the ownership
The subsidiary companies incorporated into these consolidated financial statements are as follows:
Date of incorporation
Ownership % 2013
Ownership % 2012
Name
Activity
Location
NSCSA (America) Inc.
Company’s ships agent
USA
1991
100%
100%
Mideast Ship Management Ltd. (JLT)
Technical management of ships
Dubai
2010
100%
100%
National Chemical Carriers Ltd. Co. (NCC) and its subsidiary*
Petrochemicals transportation Riyadh
1990
80%
80%
Bahri Dry Bulk LLC
Bulk transportation
Riyadh
2010
60%
60%
The associated companies that are not consolidated within these consolidated financial statements are as follows (note 10):
Date of incorporation
Ownership% 2013
Ownership% 2012
Accounting method
Activity
Location
Name
Petrochemical transportation
-
Dubai
2009
40%
National Chemical Carriers JLT * Equity method
Liquefied petroleum gas transportation
Bermuda
1980
30.30% 30.30%
Petredec Ltd, **
Equity method
* NCC has signed a joint venture agreement with “Odfjell SE” on Jumada Thani 22, 1430H, (corresponding to June 15, 2009) to establish an equally owned company in Dubai (United Arab Emirates), in the name of NCC-Odfjell Chemical Tankers JLT (referred hereinafter to as “NCC-Odfjell”), to commercially operate the two companies’ combined fleets of coated chemical tankers in a pool for transportation of chemicals, vegetable oils and refined petroleum products on a world-wide basis with its focus on the growing production and export market of the Arabian Gulf Region. On 1 June 2013, NCC acquired all “Odfjell JLT” shares which represents 50% of “NCC- Odfjell” and becomes the sole owner of this company, which registered under the name of National Chemical Carriers JLT. ** As the year-end for Petredec is different from the Company’s year-end, the share of the Company in its net income or loss is included in the Company’s accounting records according to the latest financial statements prepared by Petredec. The time difference between the latest financial statement prepared by Petredec and the Company’s consolidated financial statements is two months. The fiscal year for Petredec starts on September 1 and ends on August 31 of each Gregorian year.
On August 28, 2010, the company established Bahri Dry Bulk LLC with the Arabian Agricultural Services Co. (ARASCO) to transport dry bulk cargo with a capital of SR 200 million. The company owns 60% of the company while ARASCO owns the remaining 40%. This company has started its commercial operations in the second quarter of 2012.
NCC owns twenty four specialized chemical tankers, three of them were leased under a bareboat finance lease arrangement to Odfjell SE, a Norwegian company, and eight other carriers are chartered to International Shipping and Transportation Company Limited (ISTC), a subsidiary of Saudi Basic Industries Corporation (SABIC), and one tanker is working in a pool along with a tanker owned by Odfjell. This pool is managed by NCC JLT.
The Company owns seventeen huge oil tankers, two of them are leased to the Hengin Company (Korean), and fifteen carriers operating in the spot market. The Company also owns four RoRo (RoCon) ships operating on commercial lines between North America and Europe, the Middle East and the Indian subcontinent.
76/77
Powered by FlippingBook