Lauritzen Narrows Loss, Confirms Newbuilding Sales

Danish shipping company J. Lauritzen has confirmed that it opted to sell two Supramax bulk carrier newbuildings and cancel a part-owned handysize bulk carrier during the second quarter of 2016 as it executed further cash improving initiatives.

The company narrowed its quarterly loss to USD 22.4 million for the second quarter of 2016 from a loss of USD 117.6 million reported in the same period a year earlier. The company’s revenues for the period dropped to USD 68 million from USD 91 million seen in the same quarter in 2015.

J. Lauritzen’s loss for the first six months of 2016 amounted to USD 30.6 million, against a loss of USD 144.5 million in the first half of 2015, while its revenues for the period dropped to USD 155.4 million from USD 180.6 million seen a year earlier.

“Despite some improvements in Q2, dry cargo markets remained at historically depressed levels due to sustained weak trade growth and tonnage oversupply, which significantly impacted our EBITDA. Continuing cash building initiatives, including trimming of our owned dry cargo fleet caused additional write-downs negatively impacting the bottom-line,” Jan Kastrup-Nielsen, President & CEO, said, adding that “our gas carriers performed largely as expected.”

Total assets amounted to USD 625.9 million as at June 30, 2016, down from USD 858.6 million seen at year-end 2015, mainly due to the sale of assets and cancellation of newbuilding contracts.

Namely, the company’s two 61,000 dwt bulk carriers, currently under construction at China’s Dalian Cosco Kawasaki Shipyard, were sold in May and August 2016, respectively.

According to data provided by VesselsValue, the newbuildings, which were sold for USD 18.3 million and USD 18.4 million to Danish BW Dry Cargo and US-based Raven Capital Management, are scheduled for delivery in 2016.

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