CSAV delivers to the SVS its financial statements for the first quarter 2012

Santiago, May 10, 2012.- Compañía Sud Americana de Vapores (CSAV) announced a reduction of 18% in its operating losses during the first quarter of 2012, compared to the same period of the year before, in publishing its financial statements for the first three months.

The company reported an operating loss of US$ 175 million, compared to US$ 213 million in the first quarter of 2011. It is important to note that this information relates to the comparison of the operating results of CSAV in both quarters, excluding the results of SAAM.

The chief executive of CSAV, Oscar Hasbún, said that the operating results were in line with what the company had projected and, although negative, they were generated in a context of market conditions which were substantially worse than in the first quarter of last year, being even the worst period on record for the industry. In contrast to the first quarter of 2011, the company’s results were more in line with those of the industry.

“We reduced our operating loss by US$ 38 million with respect to the same period of 2011. This is especially relevant as the industry found itself in an adverse environment in which important market variables were significantly worse, reaching record negative levels. The Shanghai freights index fell by 16% quarter on quarter while the oil price, the company’s principal cost variable, rose by over 30%, effects that together drastically reduced margins”, he explained.

However, CSAV stated that the results were improving substantially toward the end of the quarter, showing a recovery trend explained by increases in freight rates and other cargo-related revenue.

On the other hand, the company’s loss on its discontinued operations was an additional US$ 27 million, being an expense relating to the deep operational, financial and corporate restructuring implemented by CSAV in order to improve its competitive and financial positions.

There were also other non-operating expenses so that CSAV’s total loss in the first quarter amounted to US$ 205 million.

Oscar Hasbún explained that “during March and April we have noted significant improvements in market conditions, although still not sufficient to produce positive results, this providing a basis to permit the company to recover its operating breakeven point in the context of price rises that can result from the peak cargo season”.

However, he added that “CSAV’s ability to reach breakeven is related to the behavior of these variables and the way in which the various players in our industry face the present complex scenario”.