Norden loss of 287,7m dollar in 1H
SHIPPING: Norden generated solid operating earnings (EBITDA) of 81m dollar in the first half-year of 2012. Adjusted for non-recurring income, operating earnings are 5% up from the first half-year 2011.But net profit is dragged down by a writedown of 300m dollar in Q1.
"As expected, 2012 proves to be a challenging year for the shipping industry. In light of this, I am pleased that we live up to expectations and deliver solid operating earnings and cash flow. I am also pleased that we are able to take advantage of the low vessel prices to invest in new and more fuel efficient vessels thanks to a strong financial position”, says CEO Carsten Mortensen.
It is especially the Dry Cargo Department's focus on long-term coverage and growth in cargo volumes which has contributed to earnings in the second quarter. Dry Cargo generated an EBITDA of USD 30 million, whereas the Tanker Department contributed with an EBITDA of USD 4 million in a weak market.
The operating profit (EBIT) before write-downs was USD 10 million in the second quarter and USD 35 million in the first half-year of 2012, which is 13% down from the same period last year. The drop is primarily due to increased depreciation as a result of a larger fleet of owned vessels.
NORDEN maintains its expectations for an EBITDA of USD 110-150 million, whereas expectations for CAPEX are adjusted to USD 80-100 million.
The market values of vessels dropped by another 5% in the second quarter. At the end of the quarter, broker valuations of the Company's vessels including joint ventures were USD 105 million below the carrying amounts and costs of newbuildings. The Company has performed an impairment test and has found that there is no need for further write-downs.
Coverage in Dry Cargo remains high – 89% for the rest of 2012 – whereas the Tanker Department has covered 28% of the capacity.
Source: Norden
