Pacific Basin buys secondhand handysize, warns of full year loss

Pacific Basin said it has recently acquired an eight-year-old Japan-built handysize log/bulk carrier from an unnamed seller and at an undisclosed price. The bulk carrier is expected to commence operation in early 2016.

The shipowner said the value of a benchmark five-year-old 32,000 dwt handysize bulk carrier is estimated by Clarksons Platou to have weakened from about $13m in early October to about $11.5m in mid-November.

On buying the secondhand ship, the company reasoned that the market weakness has presented acquisition opportunities at depressed prices.

Hong Kong-listed Pacific Basin also issued a profit warning, saying it expects to record a loss attributable to shareholders in the range of $5m to $20m for the full year ending 31 December 2015, narrowing from the loss of $285m posted in the previous financial year.

“The full year results will depend on the market value of the bunker swap contracts at the year end,” Pacific Basin stated.

“With all other variables held constant, if the average forward bunker rate in the bunker swap contracts increases/decreases by 10%, then the full-year mark-to-market movement would increase/decrease by approximately $2.7m,” it said.

It was further noted that the group’s first half 2015 results were positively impacted by the $15.7m one-off mark-to-market bunker derivative income and the $3.7m profit on the sale of its interest in the bunker tanker joint venture which contributed to a first half profit of $5.8m.