Eitzen Chemical ASA : 2nd Quarter 2014 results

Eitzen Chemical ASA reported an average time-charter rate of USD 10,284 per day in the 2nd quarter, which represents a decrease of 4.1 per cent from the previous quarter (Q1’14: USD 10,728 per day). The EBITDA for the 2nd quarter was USD 4.8 million, compared to USD 7.0 million in the 1st quarter of 2014 (Q2’13: USD 15.4 million).

Report highlights:

Eitzen Chemical is progressing with its ongoing and constructive dialogue with the main creditors of the Company’s long term debt to explore alternatives in order to strengthen the balance sheet so the Company again can invest and add to its asset base and market presence. Eitzen Chemical is of the opinion that with a stronger balance sheet, the Company can create more value over time for all present stakeholders. Eitzen Chemical is still significantly overleveraged with a negative book equity value of USD 157.5 million.

The weaker market and disappointing development experienced in the 1st quarter continued in the 2nd quarter. Eitzen Chemical reported an average time charter equivalent rate (TCE) for the fleet of USD 10,284 per day. The average TCE decreased by 4.1 per cent compared to the TCE of USD 10,728 per day in the 1st quarter of 2014, and a decrease of 13.7 per cent compared to the TCE of USD 11,921 per day for the 2nd quarter of 2013.

Eitzen Chemical reported EBITDA of USD 4.8 million for the 2nd quarter of 2014, compared to USD 7.0 million in the 1st quarter of 2014, and USD 15.4 million in the 2nd quarter of 2013.

For the first half of 2014 Eitzen Chemical reported EBITDA of USD 11.8 million, compared to USD 25.8 million in EBITDA in the corresponding period in 2013.

In the 2nd quarter of 2014 the Company completed a sale and leaseback of the North Fighter (19,932 dwt, built 2006). The transaction resulted in a book gain of USD 2.4 million, which has been deferred and will be amortized over the expected lease term of two years. The vessel will continue to be classified as a financial lease.

Eitzen Chemical expects a continued weak market and pressure on the TCE rate in the 3rd quarter of 2014.
Source Eitzen Chemical