Nordic American Tankers’ net profit for 4Q2019 came in at $12.7m against a Net Loss of $13.7m for 3Q2019 and a Net Loss of $10.5m in 4Q2018. “Today we announce distribution of our 90th consecutive quarterly dividend. The dividend for the fourth quarter of 2019 will be 7 cents ($0.07) per share, payable on March 16, 2020, to shareholders of record March 2, 2020. In the previous quarter we paid a dividend of 2 cents ($0.02) per share,” NAT stated.
- Developments so far in the first quarter of 2020 confirm the momentum in the tanker market. Although rates have eased recently, we believe the outlook for 2020 remains solid. A stronger market going forward will form the basis for increased dividends. Please also see paragraph 5 below.
- The balance between increased dividend and reduction of debt is a central Risk Management question. In addition to the increased dividend, NAT has since our 3Q2019 report reduced long-term debt with about $20 million, further strengthening our balance sheet. The company’s long-term debt to total assets ratio is about 37%, which is among the lowest in the industry.
- The average Time Charter Equivalent (TCE) achieved for the fourth quarter of 2019 across our fleet was about $31,700 per day per ship. So far in 1Q2020 about 70% of the trading days of our 23 suezmax units have been booked at an average TCE of $53,000 per day per ship. This is a strong improvement and an encouraging signal for increased dividend payments. Our operating costs are about $8,000 per day per ship.
- Recently we have seen several events come and go, such as the trade negotiations between the US and China and the tensions in the Middle East. These events now seem like a distant past.
- The tanker market was showing solid strength before these events and the positive developments continued in 2020. The Corona virus is now grabbing the headlines. The virus could have a negative impact in the short term. New regulations (IMO 2020) and muted supply of ships have in itself created a strong base for a solid future for the tanker industry.
- The quality of the NAT fleet is first rate, reflected in the vetting record of our ships. Vetting is the assessment of oil companies to establish the technical and operational quality of our fleet. All our ships are running on IMO compliant fuel.
Sea News, February 20