24th Feb 2014 12:58
LONDON (Alliance News) - Hellenic Carriers Ltd Monday posted a narrowed net loss in 2013 despite declines in revenue, as impairment charges taken in 2012 did not recur.
Hellenic, which owns and trades a fleet of dry bulk vessels to transport iron ore, coal and other dry bulk cargoes, expressed confidence in the improving dry bulk freight market.
Hellenic posted revenue of USD10.9 million, down from USD13.2 million in the previous year, due to a reduced number of vehicles being operated and weakness in dry bulk freight rates. The company's net loss of USD14.2 million was narrowed from USD20.7 million in the previous year when Hellenic posted an impairment charge of USD8.6 million relating to the sale of its vessels M/V Hellenic Sky and M/V Hellenic Sea.
Throughout the year the company operated an average of 3.7 vessels, down from 4.0 in the previous year, at a time charter equivalent rate of USD7,614 per day, up from USD7,414 per day in the previous year.
The company said that in order to optimise its use of cash when market opportunities arise it will make no dividend payment for 2013. Hellenic also paid no dividend for 2012, according to Morningstar Company Intelligence.
Hellenic noted that, from the beginning of 2012 to the end of the first half of 2013, the dry bulk freight market had dropped to its lowest levels in the 27 years since the inception of the Baltic Dry Index. As a result, the company avoided committing its vessels at low hire rates. However, in the second half of 2013, particularly the last quarter, the company said it saw signs of market recovery.
The Baltic Dry Index increased by 86% from an average of 842 points in the first half to 1,564 points in the second half, Hellenic said.
"After almost three years of a shipping crisis which led rates close to historical lows, we believe that the supply/demand fundamentals are now turning positive," the company said in a statement.
Hellenic said that the crisis had been caused by the oversupply of ships, but as many older vessels have been scrapped and new vessels absorbed, and dry bulk commodity demand continued to strengthen, it considers that "2014 will be the turning point towards a recovery cycle."
Shares in Hellenic were trading up 1.1% at 45.00 pence Monday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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