OW Bunker Lowers Expectations Again

Danish marine fuel (bunker) company OW Bunker has yet again reduced its expected full-year 2014 volume growth from 10% to around 6% compared to 2013 in their Q3 2014 financial report, in a move to focus on higher margin business.

Due to the slide in oil price, in particular in September, risk management resulted in an unrealised loss of USD 24.5 million, USD 2.5 million higher than estimated in the company’s October 7 announcement.

Marine fuel transaction volume rose 2% to 8.01 million tonnes (Q3 2013: 7.82 million tonnes). Volume growth in the third quarter was below the company’s expectations, but deemed satisfactory in a difficult market affected by a steep decline in the oil price.

Profit for the period before special items and tax effect was USD -5.8 million (Q3 2013: USD 20.7 million). Profit for the first nine months of 2014 before special items and tax effect was USD 27.6 million against USD 44.0 million in the same period 2013.

OW Bunker CEO Jim Pedersen said: “Overall the third quarter result was very disappointing. The fall in the oil price in particular in September was exceptional and led to a USD 24.5 million unrealised risk management loss. The margin pressure seen in the second quarter continued, but seems to have stabilised. We reduce our full-year volume forecast in a move to focus on higher margin business.”