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Wednesday, July 17, 2024

Bankruptcy threatens venerable shipping firm

Oslo-based IM Skaugen was once among the big Norwegian shipping companies, marking its 100th year in the business this year. There’s not likely to be any big celebration, though, with the company’s own accountants warning of a considerable risk of bankruptcy.

Newspaper Dagens Næringsliv (DN) reported that the annual report for IM Skaugen, released publicly on Friday, contains a strong warning to shareholders after results showed a loss of USD 4.9 million last year. The company, now operating a fleet of 15 gas carriers, has struggled for several years and has a market value of just NOK 84 million (around USD 10 million).

Auditors at PWC note that the company’s short-term debt exceeds its available reserves and that “considerable uncertainty can generate doubt over the group’s ability to continue operations.”

CEO Morits Skaugen, who inherited a portion of the Skaugen shipowning concern after his father and uncle parted ways in the 1990s, declined comment on the prospects for the firm, which has around 500 employees. The management’s commentary in the annual report states that continued operations rely on a successful outcome of several financial challenges. DN reported that IM Skaugen already has rescheduled debt payments and hopes the market will improve for its gas carriers. Its shares fell 6 percent on the Oslo Stock Exchange late last week. staff



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