As a result the most significant improvement is at Center Point, where 1.9 million barrels of storage capacity was added during 2005. Europoint also benefited from inflation escalators in contracts and lower maintenance costs in the first quarter. During the first quarter of 2006, virtually 100% of the Company’s tankage was under contract. While management is encouraged by the results of operations for the first quarter of the year, the Company was not pleased to announce on April 19th that the Dutch authorities were investigating possible embezzlement and tax issues at its Europoint facility. There are no new developments to disclose at this time. The Company has retained the services of Navigant Consulting to lead an investigation into the alleged embezzlement. Operations are continuing normally at the facility. Results of Operations For the first quarter of 2006, consolidated revenues increased by $3,766 (26%) to $18,257 compared to $14,491 in 2005. Center Point’s revenues increased by $3,632 for the first three months of 2006 as compared to the first three months of 2005. $1,763 of this increase was generated by the Gates, New York terminal, acquired in January 2005, and the Baltimore, Maryland and Newark, New Jersey terminals, acquired in December 2005. In addition, Center Point was able to convert some contracts to fixed monthly charges from activity-based charges.

 

The Company believes this will improve the long-term profitability of Center Point, as well as provide more stable operating results. Europoint’s revenues grew by $386 for the first three months of 2006 as compared to the same period in 2005. This increase reflects a $740 reduction attributable to the change in exchange rates (Euro versus U.S. dollar) between the two periods. Revenues in the local currency increased by approximately 18%. South Riding Point’s revenues decreased by $303 for the first three months of 2006 as compared to the first three months of 2005.

 

This decrease reflects the lower marine revenues for the quarter. While marine activity was quite active during the first quarter of 2005, it has been considerably slower in 2006 as our customers have tended to hold their inventory to take advantage of current market conditions. The first quarter of 2005 also included option premiums related to the proposed LNG project, which is no longer being pursued. Freepoint’s revenues increased by $51 for the first three months of 2006 compared to the first three months of 2005. This increase reflects rate increases that were put in place during 2005. Freepoint’s core business, ship movements in the Freeport Container Port, remains steady. With the exception of marine revenues at South Riding Point, which are unpredictable, revenues for the Company’s operating segments are expected to continue at levels consistent with the first quarter for the remainder of 2006. For the first three months of 2006 as compared to the first three months of 2005, operating expenses were $12,401 versus $10,676, a 16% increase. $979 of the increase is due to the costs associated with terminals acquired during 2005.

 

Operating expenses for the remainder of 2005 are also expected to continue at levels similar to the first quarter. Net income for the first three months of 2006 was $3,438 versus $2,363 for the first three months of 2005 and basic earnings per share were 14.8 cents versus 11.2 cents. First three months diluted earnings per share increased from 11.2 cents in 2005 to 14.7 cents in 2006. Segmented operating profit (net income excluding income taxes, general corporate expenses and equity earnings from investment) increased from $3,197 in 2005 to $4,958 in 2006. Net income and segmented operating profit for 2005 included a $636 gain from insurance recoveries.