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Nordic Shipholding Company announces H1 result 2018

Logistic News - Published on Fri, 24 Aug 2018

Image Source: Hellenic Shipping News
H1 Result 2018
The comparison figures for period ended 30 June 2017 are stated in parenthesis. The soft tanker market continued to deteriorate into Q2 2018. Coupled with higher bunker prices, the average daily Time Charter Equivalent (“TCE”) rates earned by the 6 vessels deployed in the three pools came in below their forecasted daily rate in H1 2018.

Compared to the same period last year, total TCE revenue fell to USD 10.2 million (USD 12.6 million) in H1 2018. Further, the TCE revenue from the LR1 vessel deployed in Straits Tankers Pool in H1 2018 was USD 0.9 million lower than the TCE revenue derived from the 3-year time charter locked in for the LR1 vessel in H1 2017.

For the 6 months ended 30 June 2018, the Group incurred a loss after tax of USD 11.8 million (which included a one-off impairment loss of USD 8.2 million for the vessels), compared to a loss after tax of USD 1.0 million in the same period last year. Excluding the impairment loss of USD 8.2 million, the Group generated a loss after tax of USD 3.6 million for the 6 months under review. Lower tanker TCE revenue from the vessels deployed in the three pools in Q2 2018 contributed to the higher losses in H1 2018.

Expenses relating to the operation of vessels in H1 2018 decreased to USD 7.2 million (USD 7.5 million) as there were certain minor ad-hoc repairs done in H1 2017.

EBITDA fell to USD 1.9 million (USD 4.1 million) due to the reduction in TCE revenue in H1 2018.

The Group recognised an impairment loss of USD 8.2 million on its vessels in H1 2018.

After accounting for depreciation, interest expenses and other finance expenses, the loss after tax in H1 2018 was USD 11.8 million (loss after tax of USD 1.0 million).

Under the loan agreement, cash in excess of USD 6.0 million will be used to pay down the loan facility. As the cash balance did not exceed USD 6.0 million, there was no cash sweep in H1 2018.

Between 31 December 2017 and 30 June 2018, equity decreased from USD 35.8 million to USD 23.8 million as a result of the cumulative loss during the period and the downward adjustment of USD 239K due to the adoption of IFRS 15, Revenue from Contracts with Customers. Consequently, the equity ratio decreased from 31.3% to 22.6% between 31 December 2017 and 30 June 2018.

During the financial period, cash flow used in operations was USD 0.2 million (cash flow from operations of USD 3.6 million). In H1 2018, the Group paid USD 0.5 million (USD 1.1 million for the dry-docking of Nordic Hanne) for the preparation of dry-docking for Nordic Ruth, which was in dry-dock from late June 2018 to mid-July 2018. The majority shareholder of the Group has extended a USD 1.0 million shareholder loan to the Group in June 2018 to support the dry-docking of Nordic Ruth. The Group used previously swept cash to make the repayment (repayment of USD 3.3 million from operating cashflows) on the term loan facility under the scheduled amortisation.

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Posted By : Joykumar Irom on Fri, 24 Aug 2018
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