Faroe Business Report — The International Review of Faroe Islands Industry and Trade - Faroe Business Report — The International Review of Faroe Islands Industry and Trade

Samskip’s continued success in utilizing a ‘Resource Center’ concept in the Faroe Islands delivers healthy financial results — confirmation of a business model that works, according to managing director Joel undir Leitinum.

MAY 2009 (North Atlantic News). Over the last few years, the highly successful transport company Samskip has seen its domestic, regional and international business grow dramatically through organic growth as well as through strategic acquisitions.

Since opening for business in the Faroe Islands in 2004, an increasing number of clients have signed up to take advantage of the geographical location of the islands, using Samskip’s operations center at Kollafjörður as a hub for shipment and storage.

According to Samskip Faroe Islands managing director Joel undir Leitinum, 2008 saw record volumes of cargo pass through Kollafjörður, much of it in transit, destined for countries in e.g. Africa, Central & Eastern Europe, and the Far East.

“Manufacturers and traders from Greenland, Russia, and elsewhere are realizing that the Faroes is centrally located in the North Atlantic for transit purposes,” Mr. undir Leitinum says.

“We are able to serve these clients by making sure their goods are safely and professionally handled. We have a well-trained, focused and service oriented workforce, with all key facilities gathered in one place at Kollafjörður. This helps us make sure operations run efficiently and effectively — from paperwork and customs clearance to loading and unloading of container ships, from warehousing and cold storage to further shipment and related services.”

The 2008 financial results were positive, which is taken as a healthy sign under the current market conditions. “I think we have a good a business model,” Mr. undir Leitinum says.


‘A very good idea’: Situated in the middle of Faroe — at equally short distance from the capital of Tórshavn, the Vágar Airport, and the industrial sites of Eysturoy — Kollafjörður is seen as something of an ideal location for Samskip. Part of the Port of Tórshavn, the Kollafjörður harbor has had several development rounds completed in the last few years, considerably extending berthing areas while increasing container storage capacity on a large scale.

Samskip’s success in the Faroe Islands is partly attributed to domestic imports and exports, and partly to transshipment business.

“The volumes of transit cargo we handled in 2008 were the highest ever,” Mr. undir Leitinum says. “We are aware that some of the conditions in the market have deteriorated lately but we still believe that we’re firmly on a path to further progress.”

The concept of a ‘North Atlantic Resource Center’ — originally floated by a former government agency that has now become part of the Ministry of Foreign Affairs — has frequently been debated in the Faroe Islands. The idea: develop services for the maritime sector, whether related to fishing, transport and logistics, offshore oil and gas, cruise tourism, or management and finance.

According to Mr. undir Leitinum, realizing the vision of that concept is an ongoing process—a process in which Samskip has taken a leading role.

“There’s been a lot of talk about this Resource Center idea, and I agree it’s a very good idea. In fact what we’ve been doing at Samskip is putting the idea into practice. We’ve made contacts with foreigners who might be interested in using the Faroes as a hub, and quite a few of them have become our clients.”

Offering multimodal container logistics and extensive container services to and from the Faroe Islands, along with refrigerated cargo logistics and international forwarding around the world, Samskip is one of the largest container transport companies in Europe. Since its founding in Iceland in 1990, the company has grown to have offices in more than 20 countries around the world, offering transport and related services by land, sea and air.

A number of strategic acquisitions took place in 2005 when Samskip purchased the shares of the Dutch multimodal transport company Geest North Sea Line, the British shortsea operator Seawheel, and reefer centers from the Dutch logistics services provider Kloosterboer. Previously, Samskip had acquired Van Dieren Maritime and a large share in Silver Sea.

As to Faroe, a comprehensive service is made available to customers, including frequent sailings to/from continental Europe, the UK, and Scandinavia, cold storage with racks and for bulk cargo, sophisticated warehousing solutions, and domestic transport systems with trucking and courier services.

Mr. undir Leitinum adds: “The Faroese have found our services to be very useful and we’ll continue our efforts to further develop our offerings, whether in terms of import and export, and regardless of whether it’s domestic, regional, or international transport and logistics services.”

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