Odfjell Tankers reports strong first quarter

Odfjell Tankers has reported revenues of $39.7 million in the first quarter, up from $26.9 million in the same period last year and $27 million in the fourth quarter.

“The chemical tanker markets improved in the first quarter and we expect the trend to continue as a result of the strong fundamentals in our markets, and a firming tanker market in general. We decided not to aggressively pursue or extend contracts at the historically low markets at the end of 2018. This reduces our COA portfolio but also increases our exposure in the firming market. We expect to continue to improve our performance in the coming quarter,” commented Kristian Mørch, CEO Odfjell SE.

Odfjell Tankers EBITDA improved to $27 million in the first quarter when adjusting for IFRS 16 impact. This compared to an adjusted EBITDA of $23 million in the fourth quarter that included a non-recurring gain of $4 million. 

The stronger results were driven by stronger spot rates on main tradelanes and lower bunker costs. This countered lower volumes and fewer revenue days compared to previous quarter. The company’s contract coverage was 50 percent in the first quarter compared to 59 percent in the previous quarter as it did not aggressively pursue contracts at historically low rate levels. 

“This increases our exposure to the firming spot markets for chemicals and CPP,” the company noted in its first quarter report. 

During the quarter, it sold and redelivered 4 vessels and took delivery of one vessel; a sophisticated super-segregator on long term time charter agreement. It also renegotiated several time charter agreements at more favourable terms. 

Odfjell Tankers bunker costs, net of bunker adjustment clauses, was $41 million. This compares to $47 million in the fourth quarter. “Our preparations for the new 2020 sulphur requirements are progressing according to plan,” it said.

It also expects the market and its tankers division result to improve in the second quarter of the year.

For more information visit www.odfjell.com

13th May 2019