NAT in Q1 2014 Black: First Time in Four Years

Posted by George Backwell
Monday, May 12, 2014
NAT Tankship: Image courtesy of NAT

Nordic American Tankers (NAT) report a cash dividend, strongly improved operating cash-flow and a positive net income in the first quarter of 2014.

The Company informs that thanks to a strong winter market, Q1 2014 has produced the best results it has seen in several years. The timecharter results of NAT were significantly better in 1Q2014 than in 4Q2013.

The short term rates in tanker markets are very volatile. At the time of this [financial] report the tanker market has weakened. Nonetheless, there are indications that after the weakness of the past few years a recovery is coming closer. During 1Q2014 we had positive cashflow from operations of $27.1m, compared with $1.9m in 4Q2013 and -$4.9m in 1Q2013.

As communicated earlier, in November 2013, NAT established Nordic American Offshore (NAO) - a Platform Supply Vessel (PSV) company. At the time of this report we expect the public listing of NAO on the New York Stock Exchange to commence very soon.
 
On April 2, 2014 NAT declared a cash dividend of $0.23 per share payable to shareholders of record as of May 15, 2014. The dividend is expected to be paid on or about May 27, 2014.
 
Since NAT commenced operations in the fall of 1997, the Company has paid a dividend 67 times, with total dividend payments over the period amounting to $44.90 per share, including the dividend to be paid in May 2014. In addition, a dividend in kind of $0.13 per share will be distributed to NAT shareholders in the form of NAO shares after the listing of NAO at NYSE.
 
During November, 2013, NAT explain that the Suezmax market strengthened, and in December the market achieved its highest level since 2010. This lasted into January before the market began to subside. NAT's strategy meant a number of cargoes were concluded at high levels. The rate increase is an indication of the improved fundamentals of the tanker business.

The Company has in place a non-amortizing credit facility of $430m, of which $250m has been drawn. Cash on hand is about $80m. Net working capital, undrawn amounts of the credit facility and cash on hand amount to $385m. In addition, the Company has cash on hand of $113.6m from the follow-on offering that closed April 11, 2014.

NAT's first quarter 2014 financial report is available at: http://hugin.info/201/R/1784418/611430.pdf
 

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