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Nordic reports net loss

Bermuda-based Nordic American Tankers Ltd (NAT) reported a net loss of 21 cents per share for the second quarter of 2011 compared to a net loss of 15 cents per share in the first quarter, despite faring better than many of its competitors.

The company also declared a dividend of 30 cents per share for the quarter - the same as for the first quarter.

In its dividend report, Nordic said that NAT was in a strong financial position compared to other shipping companies with weak balance sheets which are unable to maintain their dividend payments in the weak market which prevailed during the second quarter. Furthermore, the company pointed out that it has a $500 million credit facility available which matures in September 2013.

The company will pay the dividend on or about August 31, 2011 to shareholders of record as of August 19, 2011. Starting in the fall of 1997, when NAT acquired its first three vessels, the company has paid a quarterly dividend for 56 consecutive quarters. Including the dividend for the second quarter, the total dividend payment over this period amounts to $42.44 per share.

During the fourth quarter of 2010 Nordic's operating fleet stood at 15 vessels. By the end of October this year the company expects to have 19 trading vessels, bolstering its earnings and dividend capacity following this expansion. Its fleet will include two newbuildings from Samsung Shipyard in Korea, one to be delivered in August and the second in October. Both newbuildings are fully financed.

The company, which said it remained committed to its strategy of accretive growth through acquisitions and a strong balance sheet in a soft market, added that the company would maintain its dividend payout policy.

Operating cash flow was $7.7 million in the second quarter compared with $10.6 million in the previous quarter.

The average daily operating costs per vessel were lower in 2Q2011 than the average in 2010.

Nordic said that the piracy situation in the Gulf of Aden and in the Indian Ocean concerns the company and it was taking measures to safeguard its crew and assets.

Meanwhile the spot market for Suezmax tankers has softened this year, and going forward, the company expects rates might change quickly and unexpectedly.

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Published August 11, 2011 at 10:00 am (Updated August 11, 2011 at 10:04 am)

Nordic reports net loss

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