The National Shipping Company of Saudi Arabia (Bahri) saw its net income rise to SAR 510.3 million (USD 136 million) in the third quarter of 2015 from SAR 84.8 million reported in the same period last year.
The company’s gross profit reached SAR 611.2 million, a major increase when compared to the corresponding period from last year when it amounted to SAR 118 million.
Bahri attributed the increase in the net income to a growth in operating revenues as a result of the expansion of its VLCC fleet from 26 to 31 VLCCs, 5 product tankers and 1 floating storage vessel, following the completion of the merger process with Vela Marine International Ltd.
The increase has also been assigned to a jump in average Time Charter Equivalent (TCE) rate in crude oil transportation spot market during the current quarter compared to the corresponding quarter of 2014.
This has also been facilitated by the improvement of the company’s operating performance, decrease in average bunker cost and higher profit from Petredec Limited (30.3% owned by Bahri) by SAR 28.7 million.
The earnings per share for the period ending September 30 amounted to SAR 3.18, compared to SAR 1.29 for the corresponding period of the previous year.
Bahri is reportedly in talks with local banks to raise around 2.8 billion riyals (USD 747 million) via a long-term loan to be used towards vessel financing, Reuters said citing two sources familiar with the matter.
As informed, the funds, once obtained, would be used to buy VLCCs from South Korean shipbuilder Hyundai Heavy Industries.
Hyundai and Bahri agreed on construction of a total of 10 300,000 DWT tankers, scheduled for delivery in 2017 and 2018.