Ardmore Shipping Announces Financial Results

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(Image Courtesy: Ardmore Shipping)

Ardmore Shipping Corporation (NYSE: ASC) on Wednesday announced results for the three and nine months ended September 30, 2018.

Highlights

  • Reported a net loss of $12.2 million for the three months ended September 30, 2018, or $0.37 basic and diluted loss per share, as compared to a net loss of $4.6 million, or $0.14 basic and diluted loss per share, for the three months ended September 30, 2017. The Company reported EBITDA (see Non-GAAP Measures section below) of $3.9 million for the three months ended September 30, 2018, as compared to $10.1 million for the three months ended September 30, 2017.
  • Reported a net loss of $26.0 million for the nine months ended September 30, 2018, or $0.79 basic and diluted loss per share, as compared to a net loss of $8.7 million, or $0.26 basic and diluted loss per share, for the nine months ended September 30, 2017. The Company reported EBITDA (see Non-GAAP Measures section below) of $21.3 million for the nine months ended September 30, 2018, as compared to $34.7 million for the nine months ended September 30, 2017.
  • Spot MR tankers earned an average of $10,314 per day for the three months ended September 30, 2018, and $11,450 per day for the nine months ended September 30, 2018. Chemical tankers earned an average of $10,093 per day for the three months ended September 30, 2018, and $12,400 per day for the nine months ended September 30, 2018.
  • Completed refinancing of four vessels in October 2018. The Ardmore Dauntless and Ardmore Defender, two 2015-built 37,000 Dwt Eco-design IMO 2 product and chemical tankers, were refinanced under a finance lease arrangement with Ocean Yield ASA and the Ardmore Explorer and Ardmore Encounter, two 2014-built 50,000 Dwt Eco-design MR tankers, were refinanced under a finance lease arrangement with a top Asian financier. The net cash proceeds to the Company of these transactions, after prepayment of existing debt, were $19.7 million.
  • The Company is maintaining its dividend policy of paying 60% of earnings from continuing operations. Consistent with this policy, the Company is not declaring a dividend for the third quarter of 2018.

Anthony Gurnee, the Company’s Chief Executive Officer, commented:

“During the third quarter, we focused on optimizing our operational and commercial performance under weak charter market conditions. MR charter rates bottomed out early in the third quarter as the market experienced significant downward pressure from Atlantic Basin local market issues that initially presented themselves in the latter part of the second quarter. Nevertheless, MR rates are now trending upwards, driven by increased cargo volumes and a significantly improved crude tanker market that is reducing the encroachment of larger tankers on MR trades.

“Despite the challenging market environment, we believe the MR tonne-mile demand outlook remains very positive, supported by continued strong underlying oil consumption growth of 1.4mbd for 2018 and 2019 and ongoing refinery expansion in export-oriented locations. Meanwhile, a record low orderbook, combined with scrapping that has accelerated during the recent market downturn, should result in net fleet growth of close to zero in 2018 and around 1% in 2019.  In addition, we believe that the fundamental reshaping of the global petroleum supply chain related to the IMO 2020 marine fuel switch should significantly heighten MR demand from mid-2019 onward.

“We also continue to prioritize balance sheet strength and are pleased to have completed the refinancing of four vessels on favorable terms in October, thereby boosting our cash reserves and further enhancing our financial flexibility. By maintaining a high-quality fleet of modern, fuel-efficient product and chemical tankers and continually optimizing our balance sheet on attractive terms with diversified, top-quality counterparties, we believe Ardmore is well positioned to create substantial shareholder value in the coming cyclical recovery.”

Sea News, November 8

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