Lietuvos Juru Laivininkyste AB - Other information

According of the various articles in the media

Klaipeda, Lithuania, 2012-07-19 09:24 CEST (GLOBE NEWSWIRE) -- 



In view of the various articles in the media, hereby, Public Company
‘Lithuanian Shipping Company', would like to inform, that Mr. Audronis Lubys
who by the decision of the Board of 5 July 2012 was elected as a new Chief
Executive Officer of Lithuanian Shipping Company with the effect as from 01st
of August, 2012 has extensive experience in the shipping area; therefore, it is
very likely that his appointment to the position of the C.E.O. of Lithuanian
Shipping Company will strengthen the company and its position on the market. 

Financial situation of the company and situation of the market.

Comparing the results of Q1 of 2011 and 2012, in 2012 income increased by 1
percent, net profit (loss) of Q1 of 2012 totaled -1.018.5 thousand LTL, the
financial result of the same period in 2011 totaled 1.325,4 thousand LTL.  This
result was affected by profit (loss) of financial activities as to currency
rate exchange when transferring the financial liability from US dollars into
litas. When comparing the operating profit (loss), the results of Q1 of 2011
and 2012 demonstrate the relatively small difference (operating loss of 2012 is
185.2 thousand LTL bigger than of 2011) and it should even be considered as
positive, since, where comparing the same accounting periods, the situation on
the market has worsened significantly. 

In Q1 of 2012 the dry-cargo shipping market was not favorable for all
participants - BDI (Baltic Dry Index), which directly reflects changes on the
market, dropped to 647 points (03/02/2012), which is a lowest historical value
registered since 1986. In Q2 of 2012 the situation has slightly improved - BDI
exceeds the limit of 1000 points. Changes have affected the entire dry-cargo
shipping market the intense drop in vessels freight and lay-outs have been
observed. 

However even given the unfavorable market situation, all vessels of the
Lithuanian Shipping Company are employed. There was no vessels' off-hire or lay
out due to the lack of work either in 2011 or in 2012. By the end of 2011 the
company's management anticipated the possibility of recession in shipping and
entered into the long time-charters for the period of 6-12 months for the
bigger part of the fleet, which guaranteed stable incomes with stronger rates
then current market conditions. The vessels, engaged under voyage-charters,
also are fully employed today. Company secures relatively good earnings for the
entire fleet concerning to the overall poor market conditions. 

Performance of obligations.

Lithuanian Shipping Company does not have any overdue liabilities to the crews
and/or office employees. The company timely pays taxes to the State Tax
Inspectorate and the State Social Insurance Fund Board as well as other
mandatory payments. The company timely pays for the fuel as well for the harbor
services. The liabilities to the suppliers have increased due to vessel
repairs, carried out in Q1 of 2012, however, payment schedule agreed with all
suppliers and the company is timely performing the same. Turnover of trade
payables is approximately 30 days. 

All vessels of the company are mortgaged in favor of the bank. In accordance
with a newly agreed schedule for settlement of the loan, the company makes
timely payments; therefore, there are no grounds to expect that the bank
currently could affect the liquidity of the company. Loans are taken in US
dollars, i.e. currency, in which the company earns all of its income. Thus the
company controls the currency rate exchange risk. The amount of the debt to the
bank in litas can increase due to the strengthening of US dollar exchange rate
and it might be reflected in the balance statement of the company as the loss
of financial activities, however, the accounts payable in the loan currency are
not increasing. 



Arvydas Stropus

Chief  accountant

(+370 46) 393126