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Strategy

NORDEN wants to be the preferred partner

The course is set: NORDEN’s goal is to be a leading shipping company and the preferred partner in global tramp shipping. 

The Company seeks to achieve this goal through:

  • Organisational development 
  • Partner focus 
  • Risk management 
  • Financial strength 
  • Profitable growth
  • Corporate Social Responsibility 
  • NORDEN sees major advantages in operating both dry cargo and tanker activities and enjoys many business and organisational synergies from these dual activities; 

Organisational development

NORDEN considers human activities an essential element in the Company’s  endeavours to create value for its shareholders. The distinguishing factors are the competences within the organisation and the Company’s ability to employ the fleet and to purchase and sell vessels at the times when this is deemed most advantageous. NORDEN therefore sees it as a constant challenge to attract, develop and retain competent employees and continuously strive to develop the overall competences within the organisation The Company also focuses on recruiting shipping trainees and ships' officer cadets  to secure its future development.

Partner focus

NORDEN is dedicated to treat shipyards and customers as partners. Although marginally better terms might during certain periods be achieved by changing partners, the Company is convinced that building and maintaining lasting relations with long-term partners provides the strongest basis for sustainable growth.. By having representative offices close to where the customers are and conducting regular customer satisfaction surveys, NORDEN strives to continually improve customer service and thus build on mutually valuable partnerships.

Risk management

Active risk management is a key element in the Company’s business model. The Company actively manages the primary commercial risks relating to the shipping market: fluctuations in freight rates and prices of vessels. NORDEN continually adapts its fleet capacity and costs through a flexible business model. Equally, the Company adjusts coverage to market conditions and expectations. Other risks not related to the shipping market – bunker prices, exchange rates etc. – are hedged in so far as possible. More about NORDENs Risk Management & Risk Profile

Financial strength

NORDEN maintains strong financial resources in order to be able to take advantage of the opportunities arising in volatile markets. Shipping is a cyclical business and strong capital resources are key  for the Company’s ability to withstand fluctuations. Also, the Company’s capital structure will continuously reflect its considerable off balance sheet liabilities in the form of future time charter payments and payments to shipyards in respect of future newbuildings. 

Profitable growth

NORDEN’s business model is intended to ensure long-term, solid cash flows and withstand volatile market conditions to the extent possible.. Growth should always be profitable and the development of the business volume will always happen in accordance with this requirement. Likewise, any extension of activities will always be based on the Company’s core competences. See current fleet lists: Dry Cargo and Tanker (please note that fleet lists exclude single trip vessels)

Corporate Social Responsibility 

Safety and environment are high on NORDEN’s list of priorities – the Company therefore operates only modern, double-hulled tanker tonnage and continuously works on minimising propulsion resistance and optimising fuel consumption on owned vessels in order to cut CO2 emissions. NORDEN recognises a responsibility for climate changes, the environment, occupational health, employee conditions, safety at sea and other Corporate Social Responsibility (CSR) issues and a CSR Executive Body appointed by the Board of Directors is striving to ensure that NORDEN has a systematic management approach to CSR issues.  More details on CSR

Dry cargo: Among the global market leaders

The Company aims to be among the global market leaders in the dry cargo vessel types, Post-Panamax, Panamax, Supramax (largest Handymax vessels) and Handysize. In addition, NORDEN will have a meaningful presence in the Capesize vessel type.

See more details on NORDENs dry cargo fleet and on dry cargo.

New pools

At the turn of 2009/2010, NORDEN started up its activities in the Post-Panamax vessel type. The vessels will be operated in a pool with units from Interorient Navigation Company (INC). Effective 2009/2010, NORDEN’s Handysize vessels is also operated in a new pool with INC’s vessels, and these pools are to ensure critical mass for NORDEN and INC as well as better market coverage.        

Long-term coverage

To reduce its vulnerability to spot market rate volatility, NORDEN employs a large part of the fleet on long-term contracts.The Dry Cargo Department particularly seeks to enter into Contracts of Affreightment (COAs) with solid industrial customers and is seeing a good deal of interest from these. In volatile markets in particular, the large cargo owners prefer to let solid shipping companies handle the shipping, and NORDEN is in a good position owing to its financial strength and tradition for long-term, stable partnerships.

Flexible capacity 

Following its efforts to adapt capacity and costs to the global econonomic crisis in 2008-2009, NORDEN has  started rebuilding its dry cargo fleet, Growth is mainly based on short- and long-term charters and the existing order book which includes many deliveries of owned newbuildings and long-term charters in 2010.  

Tanker: A greater presence in the product tanker market with focus on Handysize and MR vessels

NORDEN’s goal for the coming years is to become a greater player in the product tanker market and contribute to Norient Product Pool’s consolidation of its position as one of the top-three product tanker pools globally. The means to this in the long term to extend NORDEN’s active fleet in a mix of owned units, units on long-term charter with and without purchase option and units on short-term charter. As in Dry Cargo, the rate of this expansion will depend on NORDEN’s ongoing assessment of market conditions and outlook.  NORDEN believes that prices are a a level that makes it feasible for the Company to make investments that will yield attractive returns when rates normalise. NORDEN has acquired vessels and is exploring further expansion opportunities. NORDEN already has reasonable business volume in Handysize vessel types, thus expansion is mainly expected to be made in the MR vessel type.

More details on NORDENs tanker fleet  and on tanker 

Long-term coverage

Also in Tankers, part of the fleet is fixed on long-term contracts to stabilise earnings and reduce the vulnerability to spot rate volatility. The primary focus is on increasing this coverage with A-rated counterparties. The coverage is regularly increased. 

Norient Product Pool

NORDEN’s product tanker tonnage is employed through the Norient Product Pool along with tonnage provided by the pool partner Interorient Navigation Company Ltd. The pool operates a large fleet of ice-class vessels in order to meet the customers’ demands for year-round operations, also in ice-filled waters. With the planned fleet development, the Norient Product Pool is expected to consolidate its position as one of the three largest product pools globally and achieve even greater strength and market profile. 

 

More details on NORDEN’s strategy in the Annual Report 2009 page 5 (2.64 Mb)  

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