Oil tanker company expects market turnaround
The oil tanker company Nordic American Tankers Ltd has reported a third-quarter net loss of $44.7 million.
Adjusted for an impairment of $8.4 million (non-cash), the net loss was $36.3 million, the Bermudian-based company said.
This compares with the previous-quarter net loss of $28.7 million for Nordic American, which operates a fleet of exclusively Suezmax tankers.
Chairman, founder and CEO Herbjorn Hansson said: “The International Energy Agency in Paris confirms that global oil demand is nearing pre-pandemic levels of early 2020 and more importantly, oil supply is now rising fast.
“This is good news for the NAT Suezmaxes and provide confidence that a turnaround for the NAT fleet is getting closer by the day.”
He added: “During recent months we have secured term contracts with prompt delivery for six months or longer at rates above $20,000/day or more for four of our vessels.
“The time charter rates for these ships were substantially higher than the spot market at the time and still are. These four contracts work as a hedge. Our fleet of 24 ships has significant upside.”
The company’s total net debt at the end of the third quarter was $259.6 million.
Mr Hansson said: “The pandemic has lasted longer than we anticipated at the outset in early 2020. The third quarter of 2021 was the low point.
“The average time charter equivalent for our active fleet during 3Q 2021 came in at $5,800 per day per ship — this was down from 2Q 2021 at $7,800 per day.
“NAT is through the low point. The average earnings for a Suezmax tanker for the last 30 years has been close to $30,000 per day, per ship.”
The company announced a dividend of one cent per share, payable on December 21 to shareholders on record December 7, which marks NAT’s 97th consecutive quarterly dividend payment.