2018 will be remembered as a challenging year. We experienced two very serious accidents. We were again reminded that we have to maintain a continuous focus on safety – there is no room for complacency or too much self-confidence.
The markets in 2018 were very challenging, and the year also taught us that we cannot take customer loyalty for granted – a couple of long-term customers decided to leave us. At the same time, we experienced reinforced confidence from the majority of our clients. Not only that, but some have also awarded us significant increases in their cargo volumes. Our newly formulated customer commitment is a timely reminder that Odfjell is above all a service provider: We are here for our customers.
2018 was also the year when we successfully concluded more vessel transactions than ever before. We consolidated Ship Management, took new vessels on management, redelivered several vessels and established two new pools which today deliver spotless operations.
We also developed new and state-of-the-art digital solutions, focused on further improving the integration between our various departments and business areas, and we formulated a well-defined customer commitment. Our long-term objective is crystal clear: We shall be a world-class and preferred global provider of transportation and storage of specialty bulk liquids.
As a result of our vessel transactions in the past year, we are entering 2019 with a modern, well-managed and eco-friendly fleet. However, what really distinguishes us from our competitors are our employees. The services we render to our customers are second-to-none in our industry. This is repeatedly confirmed through broker and customer meetings.
The fact that the vast majority of our contracts are renewed serves as an undisputed confirmation that the totality of our services brings value to our customers. I would therefore like to take this opportunity to thank all of you for a job well done during the year behind us. We knew that 2018 would be busy, and we passed the test with flying colors! It is a great motivation to experience the dedication and hard work that is demonstrated by everyone, every day, within our good company.
The prospects for 2019 are uncertain, but there are reasons to be carefully optimistic about the year to come.
Our focus on safety will remain. Safe operations are our ticket to trade. We can never rest on our laurels and it cannot be repeated too often: We shall never compromise on safety!
We will continue to prepare for the IMO 2020 bunker requirements. This implies that during 4Q19, we will adapt to Low Sulphur Heavy Fuel Oil on all our vessels from January 1st, 2020. This will definitely be a huge task. However, we have prepared for this transition for almost two years already, so we are confident that we will make it.
We will also redeliver five bareboat vessels during the first half of 2019 (Bow Asia, Bow Singapore, Bow Jubail, Bow Mekka and Bow Riyad). These are expensive vessels where redelivery will improve our competitive position. Shortly after redelivery, they will be replaced with newbuildings from Japan and later on, our new vessels under construction at the Hudong shipyard in China. Once again, we are replacing inefficient vessels with modern and fuel efficient tonnage.
Integration between ship management, our vessels and operations will continue in 2019, and cost-effectiveness will continue to be important. We will maintain the reinforced focus on leadership, following the leadership training initiated last year. Leaders are role models, and I expect them to act accordingly.
“We are in this game to win, not to participate,” said Mr. Dan Odfjell in the early 2000s. I share his dedication, and I really look forward to championing the competition with you – let’s make sure we win this game together!
Once again, thank you for a job well done in 2018, and I look forward to doing great work together with you this year.
Harald Fotland
Chief Operating Officer
