In apparent contradiction to the “get bigger” strategy discussed by ceo Paddy Rodgers in early September, the value of the four options, which would have been slated for delivery between 2016 and 2017, has been written off to zero, and a non-recurring non-cash charge of $8m taken for Q3.
“The value of the option was to have a sort of hedge against any significant vessel price inflation, which in the meantime has not materialised,” read the company’s Q3 report, explaining the cautious move. “After careful consideration, the Bbard has decided not to exercise the option to purchase four VLCCs.”
Otherwise, following the June acquisition of four newbuilding contract resales, first of the quartet the 299,421 vessel dwt Antigone was delivered in late September. The three remaining newbuilds are slated for delivery in early 2016.
Euronav recorded profits of $76.5m in Q3, compared with losses of $20.6m in the same period in 2014. Profits of $245m in the year-to-date have turned around a $41.7m loss in the first three quarters of 2014. Charter rates were $52,368 per day.
“The positive thesis for the tanker sector started in early 2014 continues to evolve as expected,” said Rodgers. “The four key drivers of our business: robust demand for crude oil, moderate vessel supply, high supply of oil and continued ton-mile expansion – all delivered further gains in what is usually a seasonally weak quarter.
“This resilience of the thesis was demonstrated with a strong recovery in the freight market after a number of external factors simultaneously impacted the market during August. The winter market has started very strongly. Euronav remains committed to its policy of distributing 80% of net income.”
Copyright © 2024. All rights reserved. Seatrade, a trading name of Informa Markets (UK) Limited. Add Seatrade Maritime News to your Google News feed.
