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Lauritzen better, not satisfactory

Lauritzen better, not satisfactory
Reporting a $2.9m loss for the third quarter, up from a $81m loss in the same period last year, J Lauritzen's president and ceo still sees room for improvement.

"EBITDA for the third quarter of 2013 of $21.5m was better than expected, however not satisfactory... The better than expected EBITDA together with the sale of our product tankers confirm that we are on track securing the foundation, which will enable us to realise our plans for the coming years", said Jan Kastrup-Nielsen.

The improvement in the net result was boosted by the reversal of $19m in write downs due to the 7% increase in the value of the ten product tankers sold to Hafnia, compared to their previous valuation.

Excluding one-offs, EBITDA for the first nine months of 2013 was down $8.3m on the first nine months of 2012, a drop the company attributes to the depressed bulk carrier market.

Operating income for the first nine months stood at a $207.9m loss, compared to a £97.8m loss in the same period last year. With write downs and losses on the sale of assets stripped away, YTD operating income was a $16.2m loss, similar to 2012's $16.2m loss.

For Lauritzen Bulkers, spot earnings were down 6% for handysize and 10% for supramax compared to last year, a problem caused in part by global fleet growth in the first half of 2013 and tightening grain exports due to crop failures in the US and Russia last year.

The group's gas carrier outfit, Lauritzen Kosan, has taken a hit from Iranian sanctions as its fleet became more exposed to the spot market, where rates over the first three quarters were down between 2 and 7% on last year. For the first nine months, operating income was $7.6m compared to $10.5m in the same period of 2012.

Lauritzen's outlook for the last quarter is one of significantly higher bulk market spot rates in the fourth quarter 2013 compared to last year. The company tightened its previously announced EBITDA figures for the year from $40m-$60m to $50-$60m, although the net figure for the year has been revised positively by $30m, it still stands at a $280m-$290m loss.