CHANGE IN PROFIT EXPECTATIONS FOR 2010
DFDS incures insurance technical losses due to ro-pax ship Lisco Gloria
DFDS external insurance company has today declared the ro-pax ship Lisco Gloria to be an insurance technical total loss ("Constructive Total Loss"). An extensive fire broke out on the ship on 9 October while it was en route from Kiel to Klaipeda. The ship is now laid up at the Fayard yard in Odense, Denmark.
The ship was one of two on DFDS' route between Kiel and Klaipeda. DFDS will receive total compensation of DKK 525 million, of which DKK 420 million will be compensation for the ship's insured market value. The remaining compensation of DKK 105 million relates to a hull interest triggered by declaration of total loss. The purpose of this is to safeguard against losses due to related costs such as operating losses, the accelerated deployment of a new ship and more. The compensation results in an accounting gain of DKK 260 million in 2010, after deduction of costs.
Chartered replacement tonnage was put in service on the Kiel-Klaipeda route on 16 October. In the coming months the company will be looking for a permanent solution for a replacement ship. On the basis of impairment tests conducted at year end, we have identified a need to make write-downs on ships and goodwill of DKK 180 million in 2010.
As a result of the above book profit of DKK 260 million and the write-down of DKK 180 million, the profit forecast for 2010 has been adjusted upwards by DKK 80 million, from a profit before tax of DKK 435 million to a profit before tax of DKK 515 million. The annual result will be announced on 17 March.