Major Drybulk Ship Operator Lowers 2014 Expectations

Posted by George Backwell
Wednesday, August 13, 2014
Bulk carrier: File photo

Danish shipping company D/S Norden, one of the biggest dry bulk shipping companies in the world, said it would not make a profit this year after posting a loss in the second quarter due to low freight rates and falling demand in Asia.

The firm's loss before interest, tax, depreciation and amortisation (EBITDA) increased to $7 million against $3.9 million in losses a year ago and compared to the $19.3 million-loss expected by analysts polled by Reuters.

The company lowered its EBITDA forecast for 2014 to range of a loss of $60 million and breaking even, from a previous guidance of a loss of $40 million loss to a profit of $60 million.
"The market situation went from bad to worse in the quarter. Currently it cannot be worse in the spot market," Executive Vice President Martin Badsted told Reuters by telephone.

As other shipping companies, D/S Norden was hit hard by an Indonesian export ban of bauxite and nickel while China reduced its transportation needs by drawing on its mineral stocks.

China also increased its hydroelectric generation and increased coal production for its steel industry -- both factors reducing the country's needs for coal imports that companies such as D/S Norden would have benefitted from.

"The good progress Norden experienced at the start of 2014 won't repeat soon as the weakness in the market continues in third quarter. But it has adjusted its short-term strategy by reducing its fleet size, which is a sign of common-sense and moderation," Sydbank analyst Jacob Pedersen said.

The bulk of the company's fleet of 255 vessels is comprised of small and mid-range ships in segments such as handysize, supramax and Panamax and many vessels are located in the Atlantic. Freight rates have fallen the most for small and mid-range ships and in the Atlantic.
D/S Norden operates with a large share of short-term charters, which has allowed it to cut the fleet size by 25 vessels in the quarter.

The downward adjustment of outlook for the full year is mainly due to the weak development in the dry cargo unit. The company's tanker business is expected to deliver EBITDA of between $15 and $45 million for the year.

Norden's shares were down 2.7 percent at 164.60 Danish crowns at 0748 GMT, underperforming the main Copenhagen blue-chip index which is up 0.4 percent.

(By Ole Mikkelsen)

Maritime Reporter April 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Newport News Shipbuilding Hosts Sen. Inhofe

Huntington Ingalls Industries (HII) today hosted Sen. James M. Inhofe, R-Okla., for a tour of the company's Newport News Shipbuilding division.   The senator,

Hempel CEO Jullien Plans Retirement

Pierre-Yves Jullien, CEO of Hempel A/S since 2005, has decided to retire after nearly 40 years in the Group. He will step down from his role as CEO on March 31, 2016 at the latest.

DNV GL Launches Singapore Service Center

DNV GL's new Singapore Service Center (SSC) will streamline customer support and enhance customers’ experiences by giving them a single point of contact for all operational issues.

Contracts

Vigor’s Tacoma Yard Delivers Breasting Barges to Foss

Vigor Industrial expands its newbuild capacity in Washington; Tacoma yard delivers three breasting barges   Fabrication teams at Vigor Industrial’s Tacoma, Wash.

Hands Across the Water

U.S. firms leverage Netherlands-based Damen Shipyard’s vessel designs and technical support. For nearly 40 years, Damen Shipyards Group in the Netherlands has

Icebreakers Ordered for Neft’s Novy Port Project

Aker Arctic’s icebreaker design selected for Gazprom Neft’s Novy Port project   Aker Arctic and Vyborg Shipyard have confirmed a contract for the design of two

Bulk Carrier Trends

Baltic Index Perks up on Increased Rates for Bigger Vessels

The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, edged higher on Thursday as rates for bigger vessels rose.

First B.Delta68 SUL Bulker Ordered

Deltamarin reported that its B.Delta family has scored further success as the Vulica Shipping Co. Ltd ordered the first ever B.Delta68 SUL (Self-Unloading) vessels.

The Boom Continues at Antwerp Port

The port of Antwerp handled a freight volume of 51,023,670 tonnes in the first three months of this year, 5.9% more than in the same period last year. The container

Finance

Baltic Index Perks up on Increased Rates for Bigger Vessels

The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, edged higher on Thursday as rates for bigger vessels rose.

Tanker Lifts One Million Barrels of Crude at Hariga

A tanker left Libya's eastern oil port of Hariga after lifting one million barrels of crude, an oil official said on Thursday. No new tanker was expected in the next few days,

Georgia Port Increases Container Traffic

The Georgia Ports Authority increased containerized cargo in March by 27.8 percent compared to the same month a year ago, for an additional 72,499 20-foot equivalent container units (TEUs).

 
 
Maritime Careers / Shipboard Positions Maritime Security Offshore Oil Pipelines Pod Propulsion Port Authority Salvage Ship Repair Shipbuilding / Vessel Construction Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1984 sec (5 req/sec)