EMEA News
Torm Earnings Guidance Up, Restructuring Plan Moves Forward
Torm A/S (Torm) has today announced that it is revising upwards the company's earnings forecast for 2014 after better than expected results in the third quarter of 2014 (Q3 2014), but it will still post a loss this year.
The company said it now expects to make $70-80 million before interest, tax, depreciation and amortisation, but will post a net loss for the year of $280-90 million.
Torm also said it had seen net cash inflows of $6 million after fully paying interest in Q3 2014.
"The product tanker market was relatively soft in line with our expectations for the third quarter," said CEO Jacob Meldgaard.
"Despite this, TORM's fleet was able to capitalize on the market volatility, and the TCE [Time Charter Equivalent] earnings per day were on average up by 16% compared to the third quarter of 2013."
Torm also announced recently that restructuring negotiations for the heavily indebted group are moving ahead.
The final terms to be presented to stakeholders are still being negotiated but an agreement on certain key points has been reached between 61 percent of Torm's lenders as well as Oaktree Capital Management (Oaktree).
"At this stage, the restructuring is expected to stipulate that the lenders will initially write down the debt to the current asset values in exchange for warrants and may elect to convert part of the remaining debt into new equity in the Company," said Torm.
Earlier this year, one shipbroker said that private equity firms, like Oaktree, are "ruining the [shipping] market".
