News bulletin – tanker shipping

NEWS BULLETIN

TANKER SHIPPING

BIG BUCKS FOR BW

BW LPG has reported its highest ever quarterly net profit, posting a third quarter figure of $117m, on the back of what the company calls “outstanding commercial performance and a strong VLGC freight market”. That strength was supported by firm US LPG export volumes and high price spreads, with more to come once the new Enterprise terminal comes onstream.

Those volumes are finding a ready market in the petrochemical sector in north-east Asia and in the retail sector across Asia. BW LPG therefore expects further increases in tonne-mile demand for its VLGCs, giving “a positive freight outlook for the remainder of 2019 and 2020”.

BW LPG has meanwhile agreed to sell its two remaining large gas carriers, the 59,400-m3 sisters BW Nantes and BW Nice (both built in 2003). BW LPG will book a net gain of $9m on the deal. Brokers identify the buyer as TGO, formerly Texas Gas & Oil, which is involved in international LPG trading. www.bwlpg.com

TEAM STEAMS AHEAD

Team Tankers International has posted third quarter EBITDA of $13.4m, up on the $11.8m recorded in the previous period and well ahead of the $0.7m recorded for third quarter 2018. This came despite a slight decline in average timecharter equivalent rates from the second quarter figures.

Hans Feringa, Team’s CEO, comments: “We finalised the sale of the last two of our five older MRs at attractive levels, concentrating our efforts on our younger, more sophisticated, deepsea assets. With the sale of the older MRs and certain intermediate ships, we have freed up capital for investment activity and positioned ourselves for 2020 with a more focused deepsea fleet. The divested asset prices in this quarter are at price levels well above what is implied by the third quarter traded share prices, further proving value for our shareholders. We will consider additional divestment and investment activity as we continue our positioning into 2020.” teamtankers.com

NOVELTIES FOR NAVIGATOR

Navigator Holding has reported third quarter operating revenues of $75.6m, down on last year’s $80.8m, with adjusted EBITDA slipping from $30.4m to $29.5m. The company notes some interesting trade developments, with its medium-sized gas ships handling a cargo of US butane to India and a transpacific cargo of US ethane to China; both of these are thought to be the first time ships of this size have handled such exports, which are adding substantially to tonne-mile demand in the sector. Timecharter rates have responded, rising by $200,000/ month from end June to end September to reach $740,000/month. www.navigatorgas.com

EPIC GETS PREPARED

Epic Gas has reported third quarter adjusted EBITDA of $13.5m, a slight decline on the $13.8m recorded a year ago. Revenues were strong at $47.1m, compared to $40.6m in third quarter 2018, but average timecharter equivalent earnings and tonnage loaded were both slightly down. CEO Charles Maltby notes that administrative costs were down, despite the larger fleet, and refinancings have put the balance sheet in a better position.

Looking ahead, Maltby says: “As we come to the end of the year, we are finalising our preparations to be fully IMO 2020 compliant and turn our attention to IMO 2030 and IMO 2050. Alongside the positive supply demand fundamentals for global LPG trade, we expect that these new regulations and compliance may drive higher scrappage rates of older vessels. We are well positioned with an efficient and sustainable younger fleet.” www.epic-gas.com

GOOD RETURN FROM DORIAN

Dorian LPG has reported revenues of $91.6m for its second fiscal quarter, ending 30 September, compared to $40.8m a year ago. Average timecharter equivalent earnings more than doubled from $20,973/day in second quarter 2018 to $47,623/day.

“Expansion of US export capacity and increasing demand in Asia from both the domestic and petchem sectors continue to have a positive impact on freight rates, and our market outlook remains positive,” says John C Hadjipateras, chairman/president/CEO. “We now own four scrubber-equipped ships and expect a further five within the next three months. I am confident that the professionalism of our people and the quality of our ships will earn good returns for our shareholders.” www.dorianlpg.com

ODFJELL SUFFERS SLOWDOWN

Odfjell has reported third quarter EBITDA of $51m, down from $57m in the prior period, with seasonally lower volumes that were also affected by geopolitical tensions towards the end of the quarter. On the other hand, spot rates were slightly higher and contract of affreightment (COA) renewals so far this year show a 6.1 per cent increase in rates.

“The third quarter was impacted by the usual seasonal slowdown in volumes while rates remained stable,” reports CEO Kristian Mørch. “Since then, the market has normalised and we are encouraged to see improvement in volumes and improved crude and product tanker markets, which should positively impact our markets going forward. We are further encouraged by ongoing improvement in contract rates and that customers are accepting pass-through of potentially higher bunker costs related to IMO 2020. We expect to report improved results in the fourth quarter.” www.odfjell.com

CPO NOW ZEABORN

Claus-Peter Offen Tankschiffreederei (CPO Tankers) has been renamed Zeaborn Tankers following its acquisition by the Zeaborn Group in June this year. Zeaborn Tankers is now operating as an independent company under the Zeaborn Ship Management brand and extends Zeaborn’s service portfolio into the product and chemical tanker sectors.

“Following our strategy to further consolidate the shipping industry and to expand our services as an integrated and globally active shipping company, entering the tanker management segment was a logical step. Zeaborn Tankers’ management and employees, the well-managed fleet and their organisational structure are a perfect match to Zeaborn Ship Management,” says Jan-Hendrik Többe, managing partner of Zeaborn Group. zea-ship.com

MIDSIZE BOOST FOR EXMAR

Exmar has reported consolidated EBIT of $21.8m for the third quarter, up from $15.4m a year ago, on the back of strong earnings from its VLGCs and midsize LPG carriers and the commercial acceptance of the Tango floating liquefaction unit, which began production off Argentina in November.

VLGCs are now commanding spot rates in excess of $1.8m per month, Exmar says, and rates for midsize vessels have risen from around $0.5m per month at the start of the year to in excess of $0.8m per month. “The fundamentals continue to look good for the coming months,” Exmar says. exmar.be

SASOL OPENS UP TO CHEMSHIPS

Nduna Maritime has moved into the chemical tanker sector in a partnership with Sasol, which is helping to fund the acquisition of Odfjell’s 1998-built Bow Cecil (37,300 dwt). The tanker will be used primarily to move product from Sasol’s coal-to-chemicals plant in Mpumalanga province and will be the first South Africanowned chemical tanker. Odfjell will continue to operate the vessel for its new owners.

“We believe that through this groundbreaking project, we have heeded the call to address the aspirations of our government’s National Development Plan by increasing investment in the country’s ship registry as well as by creating an enabling environment for the improvement of human capital and skills development in the sector,” says Vusi Mazibuko, executive chairman of Nduna’s parent, Mnambithi Group. www.sasol.com