Shipowner Revenue Down as Ships Paused for Redelivery

Hansen said the company has performed well due to existing agreements

Singapore-based shipowner Rickmers Maritime, which charters containerships to a number of major shipping lines, saw its revenue decline 4 percent to $33.9 million year-over-year in the first quarter of 2014 as two vessels, Henry Rickmers and Richard Rickmers, were redelivered and prepared for their next charter agreement.

A third ship, Kaethe C. Rickmers, also spent 20 days off-hire because of engine problems, contributing to a decline in utilisation to 94.3 percent.

Vessel operating expenses rose 13 percent to $9.9 million largely due to the cost of bunker fuel during the positioning of the two redelivered vessels as they were delivered to new charterers.

The company's profit declined 8 percent to $9.8 million.

Looking into the next 12 months, Rickmers Maritime warned that the delivery of new, very large ships will add to market oversupply, despite increased scrapping and continued slow-steaming, meaning that time charter rates will probably not begin recovering until 2015.

"Whilst the charter market remains under pressure as a result of the persistent over-supply of container ships in the market, Rickmers Maritime's performance has been consistent due to its existing charter agreements with reputable counter parties," said CEO Thomas Preben Hansen.

Hansen said the company has locked in 98 percent of its tonnage exposure for 2014 but that several of its charter agreements expire in Q4 2014 and Q1 2015.

"The uncertainty surrounding the timing of a charter market recovery poses a risk to the earnings and cash flows of the Trust," he said.

Major German shipping investor HSH Nordbank said last month that it does not expect a shipping recovery this year.