Odfjell Posts Best Quarterly Performance since 2008

Norwegian shipping and tank terminal company Odfjell said that it has posted the best quarterly operational performance in the second quarter of 2015 since the third quarter of 2008, with a net result of USD 7 million.

“During second quarter we have seen a steady improvement of the chemical tanker market in general with improved of earnings both in the deep-sea segment as well as in the remaining regional operations. The Odfjell chemical freight index (ODFIX) was up 5% compared with the previous quarter,” Odfjell said.

The chemical tanker market remained steady in the beginning of 3Q. However, given the softening of the CPP market and a somewhat slower summer pace in the chemicals market in August, Odfjell believes 3Q will produce slightly lower earnings than the preceding quarter.

The second quarter result for Odfjell Gas AS is slightly up from previous quarter due to better tonnage utilisation, in spite some off hire related to change of technical manager. Expectations for second half 2015 are on par with first half 2015.

The joint venture has eight LPG/Ethylene vessels on order. However, the construction of 4 x 17,000 cbm and 4 x 22,000 cbm is delayed.

“We are in discussions with the yard on new delivery dates. The yard NantongSinopacific Offshore & Engineering Co is at the same time in the process of being sold to new owners,” Odfjell said.

Odfjell’s shareholding in the tank terminals business delivered an EBITDA of USD 9.3 mill in the second quarter, up from USD 9 mill in the previous quarter. Performance was driven in part by the high demand for spot and mid-term storage due to contango in the oil market.

Odfjell Terminals also improved results with an EBITDA of USD 18 million in the first half 2015.

The group said it was about to secure firm commitments for all scheduled vessel refinancing in 2015 with expected completion shortly.

“We expect third quarter 2015 to be similar to the second quarter for our chemical tankers on a further reduced cost base, but with a slightly softer market. With regard to our terminals, we expect stable to improved earnings on capacity expansions and continued positive development at Odfjell Terminals (Rotterdam),” Odfjell added.