EMEA News
Euronav Blames Overcapacity as it Widens Losses in H1
Independent Belgium tanker company Euronav NV (Euronav) [EBR:EURN] has announced its preliminary results for the first half of 2012, blaming the weak performance on the continued oversupply of available tonnage in the tanker market.
The company reported a half year net loss of $20.2 million or $0.40 per share compared to results for the same period in 2011 of a loss of $5 million or $0.10 per share.
Euronav stated that the second quarter was negatively affected by a revaluation of market-to-market levels of hedge instruments on interest rates and rate of exchange totalling a loss of $1 million.
Performance comparison to the second quarter 2011 saw that there was a one-time profit of $22.1 million on the sale of the VLCC Pacific Lagoon skewing the EBITDA to positive territory, but without that profit performance for the second quarter of 2012 was actually 60% higher at EBITDA $50.3 million compared to EBITDA $31.6 million in 2011.
Time charter equivalent earnings (TCE) in the first six months for VLCCs were 26,560 compared to 23,000 in 2011.
Suzemax TCE were 26,500 in the first 2012 semester down from 29,800 for the same period in 2011.
The Antwerp headquartered firm said Q2 improvements were attributable to a reduction of oversupply due mainly to longer voyages from West Africa, Latin America, and the Caribbean to the Far East and India, as well as a decrease of the actual number of ships available because of either quality standard requirements or scrapping activity.
Euronav stated that since the beginning of July, rates have been falling consistently to levels not seen since the month of October 2011.
Looking ahead, Euronav Management said it remains cautious in respect of the outlook for the rest of the year, adding that so far in the third quarter its 9 VLCCs traded by the Tankers International pool on the spot market has earned an average $17,200 per day and 32% of the available days had been fixed.
"The challenge for the tanker market is still almost entirely on the supply side," it said.
Final half year results are expected to be available at the end of August 2012.
