'Samsun Logix Keeps
the Ball Rolling'

Posts all-time high performance since its inception

Samsun Logix Corp. is an up-and- coming integrated shipowner/operator, moving dry bulk cargoes and crude oil worldwide and providing trading services, including the import of raw materials and the export of steel products.
Samsun Logix CEO Hur Hyun-chul said, "Samsun Logix has chalked up an all-time high for business performance since its establishment due to a boom in the shipping market: Approximately 1 trillion won in sales and about 120 billion won in operating income in the first half of 2008. We are forecast to post about 2.2 trillion won in sales and 250 billion won in operating income during the whole of 2008."True to its catchphrase, "Global Total-Logistics Enterprise,"Hur said, Samsun Logix has been employing such innovative steps as a merit system based on capabilities, an online system management and a perfect team-oriented system.
Samsun Logix plans to raise the percentage of its owned ships to 30 percent or 50 vessels as well as the size of its fleet from the current 150 to about 200 ships, Hur said.
"We strive to build a stable profit-oriented structure by expanding our fleet based on long-term cargo transport contracts in order to hedge against the recent widening of the fluctuations of the shipping market,"he said.
Hur painted an upbeat picture of the global shipping market. "The Baltic Exchange Dry Index (BDI) level, which underwent corrections in June after shattering the 10,000 point barrier, is now hovering over the 9,000 point level. The BDI is predicted to rebound after the traditional low season of summer and reach a record high during this year,"he said.
"Korean shipping companies are in a weak and vulnerable structure that can be influenced by market fluctuations since they have a higher percentage of chartered ships compared to their owned ships,"he said. "If the market sees a fast downturn, it will not be easy for newcomers with a weak foundation to survive. Accordingly, shipping companies need to brace for a glut of ships that are forecast to surge after the year 2010. Overall,
large-scale Korean shipping companies have built up enough of a foundation to endure rapid market upheavals."The following are excerpts of a written interview by Samsun Logix President Hur with NewsWorld.
Question: Will you tell our readers about the current status and prospects of the Korean shipping market?
Answer: The Korean shipping market saw a plunge in national flagged ships as Korean shipping companies were forced to dispose of their fleet at lower prices due to a business slump, caused by a dearth of debt repayments and operating funds following the Asian financial crisis in late 1997. However, the market has seen quantitative growth in terms of national flagged ships in the recent few years and business conditions improving at a rapid pace thanks to a boom in the market since 2003, which returned to the levels registered before 1983 when it underwent restructuring.
Korean shipping companies are in a weak and vulnerable structure that can be influenced by market fluctuations since they have a higher
percentage of chartered ships compared to their owned ships. If the market sees a fast downturn, it will not be easy for newcomers with a weak foundation to survive. Accordingly, shipping companies need to brace for a glut of ships that are forecast to surge after the year 2010. Overall, large-scale Korean shipping companies have built up enough of a foundation to endure rapid market upheavals.
In 2007, overseas-bound shipping companies chalked up 34 trillion won in sales, 2 trillion won in operating income and 1.9 trillion won in ordinary income. As of the end of 2007, Korean shipping companies have a fleet of 721 ships with 18.1 million gross tons, up 20 percent over the previous year.
Q: What has the business performance for Samsun Logix been like so far this year and what are the prospects for the whole of this year?
A: In the first half of 2008, Samsun Logix posted about 1 trillion won in sales and approximately 120 billion won in operating income to register an all-time high for performance since its establishment thanks to a boom in the shipping market that shows signs of improving since the second half of 2007. The market is predicted to remain unchanged in overall market conditions, so Samsun Logix's total sales are projected to reach about 2.2 trillion won and 250 billion won in operating income during the whole of 2008.
Q: Will you comment on the prospects of the global shipping market for this and next year?
A: The global shipping market is expected to remain brisker for this year than any year. The Baltic Exchange Dry Index (BDI) level, which underwent corrections in June after shattering the 10,000 point barrier, is now hovering over the 9,000 point level. The BDI is predicted to rebound after the traditional low season of summer and reach a record high during this year. The global shipping market is expected to suffer no acute corrections for next year, but remain somewhat lower than this year. Even if conditions in the market for next year can be determined according to the number of newly-built ships hitting the market, the global market is considered to have strong fundamentals due to unabated demand from China and possible growth in the Indian and Latin American markets.
Q: Will you tell us about the current status of ships operated by Samsun Logix and any plans to expand its fleet?
A: Samsun Logix has a fleet of about 150 ships, including long-term chartered vessels and 17 owned ships. We will take delivery of a newly built ship in 2009 and five more new ones in 2010. Samsun Logix plans to raise the percentage of its owned ships to 30 percent or 50 vessels as well as the size of its fleet to about 200 ships. We strive to build a stable profit-oriented structure by expanding our fleet based on long-term cargo transport contracts in order to hedge against the recent widening of the fluctuations of the shipping market.
Q: Will you explain the management innovations your company has implemented?
A: Samsun Logix has built a perfect team-oriented system by delegating authority to the lower echelons. All staff members are required to complete online educational programs and write impressions on books they read. We have introduced an online system management and established a merit system based on capabilities.
Q: What're your company's global strategies?
A: Our company has already gone global in the shipping and trading sectors, considered to be well-globalized business areas. Samsun Logix, which has already opened branch offices in Greece and Shanghai, is considering establishing more branches in Singapore, Dubai and London (Europe). We strive to expand our overseas network and establish joint ventures with major foreign owners/operators, while considering bids to acquire shipping-related companies.
Q: What're your corporate motto and management key words?
A: I cherish my corporate motto, "Global Total-Logistics Enterprise,"and management key words, "Pursuit of Smart Working and Intelligent Business." nw

Samsun Logix Chairman Song Choong-won

Samsun Logix has a fleet of about 150 ships, including long-term chartered vessels and 17 owned ships.

Samsun Logix President Hur Hyun-chul