Chairman's Statement

Dear Shareholders

Since undertaking the role of Chairman at VARD in October 2016, I have had the privilege of gaining deeper understanding of the Group’s values and vision, its people and operations. I am respectful of the strengths of the organization, its unique shipbuilding know-how built over generations, and the recognition it receives from some of the most demanding clients in the industry. But I am also mindful of the challenges still ahead of us on the path back to sustainable, profitable growth.

2016 was a year of profound changes for VARD, during which great strides were made to reposition the Group to strengthen it operationally and financially, and mitigate risks in our portfolio. The most visible change is in respect to the successful diversification into new markets, from exploration cruise to fishing and aquaculture. Behind this success is VARD’s courage to think out-of-the-box, its willingness to learn and adapt, and an unwavering determination to succeed. With the same determination, the Group is now tackling the implementation stage of its new strategy and business plan, on course towards the delivery of its first cruise vessel in mid-2018. All the while, we continue to innovate and leverage our know-how and relationships to seize new business opportunities in the offshore sector.

I am particularly encouraged by the ever-increasing cooperation between VARD and Fincantieri. The long-term agreement to produce parts of cruise vessel hulls for Fincantieri projects at VARD’s Romanian shipyards has linked the companies inextricably, providing tangible and intangible benefits to both. A wealth of other commercial transactions taps the strengths of each organization, while the tight cooperation with Fincantieri in the exploration cruise vessel segment is a clear competitive advantage for VARD over other new entrants into this market.

Fincantieri’s strong commitment to VARD was also demonstrated by its voluntary offer to minority shareholders to acquire all outstanding shares in the Group. Irrespective of the final outcome of the offer, Fincantieri has reinforced its ownership position in VARD, and I wish to assure all stakeholders that our relationship remains positive.

Through continued focus on seizing diverse market opportunities, operational excellence, and strong cooperation within the Fincantieri group, I am confident that VARD will emerge from the challenges of 2016 stronger and more robust, and will reassert its role as a leading designer and builder of specialized vessels in the global shipbuilding arena.

On behalf of the Board of Directors, I would like to thank our shareholders and clients for their continued support and trust in VARD.

Mr. Giuseppe Coronella









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