Port delays and reduced spot trading on the routes from Europe and Asia to the US kept competition for berths high and rates low for the chemical tanker segment, which lost $5m in the quarter. There was some good news at the end of the quarter for clean product tankers, which Odfjell expects to have a positive knock-on effect on chemical tankers.
The group's tank terminals arm lost $9m in the quarter. Reorganisation and staff reduction at the Odfjell's troubled Rotterdam terminal were completed by August, but the facility contributed a negative EBITDA of $6m to the results. Final negotiations are underway to sign full commitment to the full capacity of the Charleston terminal, which opened earlier this year.
Profit was made at Odfjell's gas carriers company, which posted a $5m profit. A $50m joint venture transaction was finalised at the end of September. The deal involved the sale of 50% of the shares in Odfjell Gas Carriers to Breakwater Capital and Oak Hill Advisors, which resulted in a $6m gain for the quarter at Odfjell. The contract also involved a commitment to provide $50m to finance the existing LPG/Ethylene newbuilding orderbook at the company.
"We expect fourth quarter of 2014 to improve from the third quarter for our chemical tankers on a slightly stronger market, contract renewals, lower bunker costs and a reduced cost base," the company stated in its earnings release.
"With regard to terminals, we expect improved results at Odfjell Terminals (Rotterdam) due to increased utilisation and a lower cost base. For the remainder of the terminals we expect a slight increase in earnings due to increase capacity."
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