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Ardmore Shipping Corporation announces net profit loss of 6 month of 2018

Logistic News - Published on Thu, 02 Aug 2018

Image Source: Craft.co
Ardmore Shipping Corporation announced results for the three and six months ended June 30, 2018.

Highlights and Recent Activity
Reported a net loss of USD 8.6 million for the three months ended June 30, 2018, or USD 0.26 basic and diluted loss per share, as compared to a net loss of USD 1.9 million, or USD 0.06 basic and diluted loss per share, for the three months ended June 30, 2017. The Company reported EBITDA (see Non-GAAP Measures section below) of USD 7.6 million for the three months ended June 30, 2018, as compared to USD 12.9 million for the three months ended June 30, 2017.

Reported a net loss of USD 13.7 million for the six months ended June 30, 2018, or USD 0.42 basic and diluted loss per share, as compared to a net loss of USD 4.0 million, or USD 0.12 basic and diluted loss per share, for the six months ended June 30, 2017. The Company reported EBITDA (see Non-GAAP Measures section below) of USD 17.5 million for the six months ended June 30, 2018, as compared to USD 24.6 million for the six months ended June 30, 2017.

Completed refinancing of the Ardmore Endurance and Ardmore Enterprise, two 49,000 Dwt Eco-Design product tankers, under a sale and leaseback arrangement providing net proceeds, after prepayment of existing debt, of USD 10.3 million.

Spot and pool MR tankers earned an average of USD 11,510 per day for the three months ended June 30, 2018, and USD 12,086 per day for the six months ended June 30, 2018. Chemical tankers earned an average of USD 12,527 per day for the three months ended June 30, 2018, and USD 12,816 per day for the six months ended June 30, 2018.

We are maintaining our dividend policy of paying 60% of earnings from continuing operations. Consistent with this policy, the Company is not declaring a dividend for the second quarter of 2018.

Mr Anthony Gurnee, the Company’s Chief Executive Officer, commented “In the second quarter we remained focused on operational efficiency under challenging charter market conditions. While the fundamentals of the product tanker market remain sound, a number of unrelated short-term factors came together to put downward pressure on cargo volumes and charter rates, particularly in the Atlantic Basin. Cargo flows from the US Gulf to Brazil and Mexico declined in the latter half of the second quarter as a result of domestic issues and consequent increases in local refinery throughput. Simultaneously, a significant build-up of West African product inventories during the first quarter further reduced cargo volumes and freight rates from Europe and the US during the second quarter.

Despite the impact of these short-term factors, the outlook for our sector remains positive. Driven by continued strong underlying oil demand growth of 1.4mbd for 2018 and 2019, ongoing refinery expansion, and low refined product inventory levels, we expect normal trading conditions to return to the product tanker market. Furthermore, we expect the changing regulations for bunker fuels which take effect from January 1, 2020 to result in a significant increase in seaborne volumes of refined products from mid-2019, providing a further boost to tonne mile demand. On the supply side, ongoing scrapping and the record-low orderbook for MRs should result in net fleet growth of less than 1% in 2018 and 2019. This pairing of strong tonne mile demand growth and very limited supply growth creates the conditions for a rebound in charter rates.

Meanwhile, we are focused on maintaining financial strength to ensure that the Company can take full advantage of opportunities that may arise. During the quarter, we completed a refinancing of two Eco-Design MRs under a sale and leaseback arrangement with a top- tier Asian financier on attractive terms comparable to our existing debt facilities. With our best-in-class cost structure, strong balance sheet, and modern, high-quality fleet, Ardmore is well positioned to deliver significant value to shareholders in a cyclical market recovery.

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Posted By : Joykumar Irom on Thu, 02 Aug 2018
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