Low MR Charter Rates Hurt Pyxis Tankers’ Earnings

Due to lower MR charter rates, Greek product tanker company Pyxis Tankers ended the second quarter of this year with a widened net loss.

The company posted a net loss of USD 1.3 million in Q2 2018, compared to a net loss of USD 0.8 million seen in the corresponding period a year earlier.

Voyage revenues stood at USD 7 million for the three months ended June 30, 2018, representing a decrease of USD 1.4 million from USD 8.4 million reported in Q2 2017. As explained, the decrease in gross voyage revenues during the second quarter of 2018 was primarily due to lower time charter equivalent rates, as well as to a slight decrease in total operating days attributed to increased idle days between voyage charter employments.

“Overall, our operating results for the second quarter of 2018 were mixed. As the quarter unfolded, the time charters for our medium range tankers (“MRs”) rolled-off into a very difficult spot market at much lower rates,” Valentios Valentis, Pyxis Tankers’ Chairman and CEO, commented.

“Weaker demand for MRs was caused by temporary market disruptions in the Atlantic basin, led by lower activity in the Gulf of Mexico, continued drawdown of inventories of refined petroleum products in storage and intrusion of larger ships, mainly newbuild crude carriers, which transported clean products on their maiden voyages. Three out of four of our MR tankers are currently in the spot market, which we hope will improve by this fall,” Valentis added.

“As for our small tankers, we experienced a nice improvement in trading activity compared to the first quarter of 2018. We have continued to focus on our costs during this challenging period. The success of our efforts was clearly demonstrated during the second quarter as our total operational costs (…) improved,” Valentis continued.

The company’s CEO further said that chartering activity is expected to be challenging, however, with a modest upward trend when moving into the fourth quarter. Additionally, a long-term improvement in charter rates is expected as a result of attractive market fundamentals.

“We remain optimistic about the fundamentals of the product tanker market, specifically for MRs, and believe that Pyxis Tankers has the platform and position to take advantage of them,” Valentis concluded.

Focused on growing its fleet of MR vessels, Pyxis Tankers currently owns a fleet of four MR and two small tankers engaged in seaborne transportation of refined petroleum products and other bulk liquids.