Audited financial report of year 2016 of AS “Rī

As a result of the audits were corrected accrued revenue and according to corrections in 2016 a total net turnover of AS "Rīgas kuģu būvētava" was EUR 20 757 784, but gross profit in the amount of EUR 1 212 811.

AS “Rīgas kuģu būvētava” draws attention that was corrected also company income tax and correspondingly a net profit of AS “Rīgas kuģu būvētava” in the report period was in the amount of EUR 169 807.

In 2016 AS “Rīgas kuģu būvētava” performed the repair of 71 vessel (in comparison with 2015 – the repair of 69 vessels). Such results were achieved providing ship hulls reinforcement and insulation works during 2016 winter months without using the docks. In 2016 3 ship hulls were built and floated out, which is less than initially planned, caused due to objective circumstances when customers were not able to attract funds for project implementation in planned time.

As a new segment of Company’s production range is industrial metal constructions. The Company's Board and specialists dedicated a lot of time and energy to get the company certified and receive real orders for this market sector. In 2016, upon receipt of positive references, the Company delivered an order, which consisted of 2 metal reels with a diameter of 8.5 meters and 7 metal reels with a diameter of 5.7 meters. Currently under negotiation is receipt of the next orders. This new production sector allows maintaining at the high level Company’s technical personnel’s professional qualification, as well as to align workforce capacity during the winter months and generate extra revenue.

AS “Rīgas kuģu būvētava” products and services, as well as the principal raw material suppliers have not changed. Shipbuilding customers are mainly from Scandinavian countries, ship repair – Western ship service agencies and shipping companies. The main materials and spare parts suppliers are the companies registered in Latvia and in the European Union.

The Company’s Management Board in cooperation with its Council continues the market research activities, participates in international exhibitions and support programmes to uptake new production sectors and new markets in order to ensure better use of production capacities and increase the labour productivity in the Company. Certification of the Company according to new and additional standards opens up new opportunities to offer Company’s products and services in new markets.

Upon evaluation of the existing market situation and the Company’s opportunities, the Management Board performs the actions to increase the number of the built and repaired ships at the plant, as well as to get engaged more actively in the broader uptake of the market of industrial metal structures.

To achieve the set objectives the Company’s Management Board reviewed the agency contracts concluded earlier, assessed their effectiveness and concluded contracts with those agents, who gives a real contribution to the development of the Company’s production. New agency contracts were concluded for markets, where traditionally the Company was not actively represented. In 2016 the Management Board will continue expansion of the launched course of development with a focus on the environmental protection measures, as well as continue investing in the modernisation of production equipment of the Company, thereby enhancing competitiveness of the Company and contributing to the business development.

The Management Board of AS “Rīgas kuģu būvētava” proposes the net profit of 2016 in the amount of EUR 169 807 to direct for further development of the Company.

Find hereby enclosed the audited Financial Report of year 2016, auditor's report and Corporative Governance Report on 2016.

         Marina Pudova          Chief accountant          Phone: +371 67080868          E-mail: marina@riga-shipyard.com