Norden loses $26.5m in Q1, forecast reaches into the red

Comparing Q1 2013 and Q1 2014, costs rose 15% to $656.3m, outpacing an 11% rise in revenue to $557.7m.

Despite being the smaller of its segments and a weak winter market for MRs, Norden's tanker arm posted a $10m EBITDA, buoyed by a strong performance from its handysize fleet. The split market was due to a cold US winter reducing US clean product exports and European diesel imports, while soaring crude oil transports rates form VLCCs trickled down to Norden's handysize fleet, spurred by Chinese demand.

For dry bulk, the market suffered from the Indonesian ban on exporting bauxite and nickel ore which led to overcapacity in the Atlantic as ships ballasted from the Pacific. As well as the oversupply, demand again dropped as US coal imports fell due to increased domestic demand during a cold winter.

Norden adjusted its 2014 outlook down to an EBITDA between -$40m and $60m from $20m - $120m.

The group's president and ceo Carsten Mortensen commented: "As expected, the first quarter saw challenging market conditions, not least in dry cargo where the Atlantic market more or less collapsed. This collapse has also had a significant impact on the second quarter, which we were otherwise expecting to contribute positively to operating earnings. Therefore, we now take the consequence of this and make a downward adjustment of the expectations for the results for the year.

"However, this does not change the fact that we are still expecting an improvement of the markets in the second half-year and that I am pleased with the continued increase in ship values, which are now $175m above carrying amounts."

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