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Torm performs in soft product tanker market

Torm performs in soft product tanker market
Torm announced a lower third quarter loss of $26m, down from a $40.2m loss in the same period last year.

The struggling tanker outfit's loss for the first three quarters stands at $271.4m, up from $86.7m in the first nine months of 2013.

In late October Torm entered into an agreement with its lenders and private equity investor Oaktree Capital Management that should produce a restructuring agreement for Torm by the first quarter 2015.

LR2 time charter equivalent earnings (TCE) were up 55% year on year to $17,582 per day, LR1s saw a 25% increase to $19,172 per day and MRs a 2% drop to $14,295 per day. Operating profit for the tanker segment as a whole was $7m, up from a $9m loss in Q3 2013.

Torm's dry bulk arm recorded a 28% TCE improvement for its seven panamaxes, which averaged $10,426 per day.

At the end of the quarter, Torm had covered 19% of its remaining tanker earning days in 2014 at $16,803 per day and 55% of the remaining bulk earning days in the same period at $9,673 per day.

"The product tanker market was relatively soft in line with our expectations for the third quarter. Despite this, Torm's fleet was able to capitalise on the market volatility, and the TCE earnings per day were on average up by 16% compared to the third quarter of 2013. Torm continued to generate positive cash flows from operations after full interest payment," says ceo Jacob Meldgaard and adds, "I am pleased that Torm has entered into an agreement with a group of its lenders and Oaktree Capital Management regarding a possible restructuring of Torm."