IMAREX - weaker second quarter results, but strong trading outlook

Trading activity at IMAREX rose substantially in the second quarter despite poor trading conditions due to lower underlying freight rates and less volatile markets.

Maritime derivative transactions conducted via IMAREX rose 78% to 2 022 trades compared to the same period last year. Trading volumes rose 22% to 47 732 lots (contracts). The nominal face value of contracts traded in the period rose by 67% to USD 1 115 million.

Revenues declined by 7% to NOK 18.3 million in the second quarter of 2006 from NOK 19.7 million last year. Overall revenues were down due to poor market conditions in slow and less volatile shipping markets, reduced fees for tankers and dry bulk, and an adverse effect of a lower USD exchange rate. Fees from bunkers fuel oil trading are not yet contributing significantly. IMAREX experienced a loss of NOK 4.9 million (-1.9 mill in Q205) reflecting the lower revenue.

The underlying business at IMAREX and NOS was strengthened by the addition of new trading and clearing members. Membership rose 43% to 134 compared to Q205. Growth continues into Q3.

To further strengthen the business for growth going forward, the merger of ownerships in IMAREX and NOS has been approved and is expected to be closed on the 1st September. The merger will create a stronger company combining the world's leading marketplace and clearing house for freight derivatives with solid potential and ability to grow in new related markets.

"The merged IMAREX NOS ASA will create a stronger financial and strategic platform than the two companies could ever have achieved on their own, and separately”, says Tom Even Mortensen, IMAREX Managing Director. ”Our new organisation will maintain full focus on continuing to strengthen the position we have built as the leading market place for maritime derivatives and our commodity clearing services to customers," he adds.

Adding European power and emissions derivatives to its product mix, IMAREX closed the acquisition of M3 in July. M3 is the leading broker of Nordic power derivatives with over 30% market share of the OTC market. In addition IMAREX is in the process of buying NENA AS, a leading European energy research firm based in Oslo.

"The merger with NOS and the acquisitions of M3 and Nena are all expected to contribute to a stronger performance ahead for the group," says Mortensen.

NOS reported revenues of NOK 25.5 million in the second quarter 2006 (16.5), and NOK 47.3 million for the first half year. The profit before tax was NOK 4.0 million (10.6) in the quarter and NOK 14.0 million for the first half year (23.2) for the current business in freight and financial clearing.

"We have got off to a flying start in Q3 with all our markets looking very bullish. Trade values are up more than 60 % over Q2 already, and we will break most of our records in August. We seem to have a real busy time ahead of us," Mortensen concludes

For more information please contact:

• Tom Even Mortensen, Managing Director – tel: +47 2389 4222
• Arild Jæger, CFO tel: +47 2389 4211

Please see enclosed Q2 report and presentation:

• IMAREX Q2 Interim financial results

  Imarex_06Q2_report.pdf 439.54 kB

• IMAREX Q206 Investor presentation

  Imarex_06Q2_presentation.pdf 280.18 kB