Ardmore Refinances Seven, Disposes of Two Ships

Ardmore Shipping has refinanced seven vessels and reached agreements to sell two units during the fourth quarter of 2018.

Ardmore Seavaliant; Illustration/Image Courtesy: Ardmore

Namely, the company completed financing transactions two 2015-built 37,000 dwt Eco-design IMO 2 product and chemical tankers and five 2014-built 50,000 dwt Eco-design MR tankers. Each of these were refinanced under finance lease arrangements, according to Ardmore.

The net cash proceeds to the company of these transactions, after prepayment of existing debt, were USD 32.7 million in the aggregate.

Ardmore also agreed to terms for the sale of the 47,000 dwt Ardmore Seatrader and the 45,840 dwt Ardmore Seamaster, the 2002- and 2004-built Eco-mod MR tankers.

Ardmore Seatrader was sold for USD 8.3 million and delivered to its buyer on January 9, 2019, while the Ardmore Seamaster would be disposed of for USD 9.7 million and is expected to join its new owner in February 2019.

The company revealed the transactions as part of its fourth quarter of 2018 financial report, in which it said it delivered a net loss of USD 8.8 million from continuing operations for the three months ended December 31, 2018, as compared to a net loss of USD 3.8 million seen in the same period a year earlier.

For the twelve-month period ended December 31, 2018, Ardmore’s net loss reached USD 34.3
million, as compared to a net loss of USD 12 million reported in the previous year.

Spot MR tankers earned an average rate of USD 12,475 per day for the three months ended December 31, 2018, and USD 11,564 per day for the full year period. Chemical tankers earned an average rate of USD 10,779 per day during the quarter and an average of USD 11,406 per day for the full year.

“Ardmore successfully weathered very difficult market conditions in 2018 by maintaining its financial strength and keeping a clear focus on operational performance,” Anthony Gurnee, the Company’s Chief Executive Officer, said.

He added that significant improvement was visible in the market rate environment late in the year, while even better market conditions anticipated in 2019 “as the impact of IMO 2020 begins to be felt.”

“The outlook for product demand is positive, supported by expected continued strong underlying oil consumption growth along with estimated global refinery capacity additions of 2.6 million barrels per day for 2019, the largest annual increase since the 1970s.”