EMEA News
Navios Maritime on Dry Bulk: As Difficult a Market as Ever Existed in Shipping
Shipping and logistics company Navios Maritime Holdings Inc. Thursday announced its numbers for FY2015, calling conditions in the dry bulk sector "as difficult a market as ever existed in shipping."
The company reported $480.8 million in revenue for 2015, and a loss of $134.1 million, compared to revenues of $569.0 and a loss of $56.2 million in 2014.
"We have experienced as difficult a market as ever existed in shipping, highlighted by the recent [Baltic Dry Index] low of 290 which is 43% lower than the all-time low established only one year ago. The average BDI of 350 for 2016 is the lowest recorded since 1986," said Angeliki Frangou, Chairman and Chief Executive Officer.
The CEO went on to say, however, that while "this extended period of weakness is unprecedented," there are "green shoots."
Accelerated scrapping, a continued slippage in new buildings, and the absence of new building orders are reasons for optimism.
"We anticipate negative net fleet growth in the dry bulk industry in the near-term coupled by demand from continued global growth," said Frangou.
The company says it reduced cash requirements without having to sell off assets and is "honoring our obligations; Frangou suggested the company is well-positioned to weather the chop with $176.9 million in cash on hand.
"We have resourcefully established cash flow needed in the medium term to sustain the company until charter rates improve," he said.
The company updated its fleet in January with the Navios Sphera, a 2016-Japanese built 84,872 dwt Kamsarmax vessel, and Navios Mars, a 2016-Japanese built 181,259 dwt Capesize vessel.
Navios Holdings, the largest shareholder of Navios Maritime, announced a financial loss the previous week.
A financial website pointed out that Navios Maritime recently provided a $50 million loan to Navios Holdings.
Last month Ship & Bunker reported that the Baltic Dry Index had fallen to such historic lows the stock price of dry bulk shippers like Navios had fallen by up to 90 percent.
