24th Jan 2025 14:40
(Alliance News) - Taylor Maritime Investments Ltd on Friday reported a decline in its net asset value, as US trade policy uncertainty hurt sentiment.
Taylor Maritime said its net asset value declined in the third-quarter to December 31, falling to USD1.28 at December 31 from USD1.48 at September 30.
Shares in the Guernsey, England-based shipping investor dropped 5.8% to 70.30 pence each on Friday afternoon in London.
Taylor Maritime said the decrease in NAV was "driven mainly by softer asset values".
The company divested 28 of its ships in the last 24 months, in an effort to reduce leverage and overall expenses.
Though most sales were achieved "at or close to NAV", the shipping firm said sale prices averaged a 3.4% discount to fair market value. The like-for-like market value of Taylor Maritime's fleet fell 8.2% to USD560.2 million in the third-quarter.
Nonetheless, the company said asset disposals had reduced its debt by USD208 million to-date. Total debt was USD252.0 million at December 31, down 12% from USD282.7 million year-on-year.
During the period, its fleet generated average time charter equivalent earnings of USD12,150 per day, fading from USD14,211 in the second quarter.
Market rates fell as "Panama Canal transits increased toward pre-drought levels", while commodity demand did not got a usual seasonal boost with "uncertainty surrounding the incoming US administration's trade policies dampening sentiment".
Taylor Maritime declared an interim dividend per share of 2 US cents, unchanged year-on-year, and a special dividend of 4 US cents per share - a reward following the successful debt reduction, Taylor Maritime said.
The company refinanced two existing loans into a single 4-year loan due December 2028. Taylor Maritime's debt-to-gross-assets ratio was around 35% at December 31, fractionally higher than the previous year, but still below loan covenant requirements, the company said.
The company plans to continue asset disposals, targeting future look-through leverage between 25% and 30% of gross assets.
Additionally, its shares will be transferred to the equity listing category, to reflect changes in the firm's business model. Taylor Maritime said it now more closely resembles a shipping company than an investor. The transfer is expected on February 10, coinciding with the firm's renaming to Taylor Maritime Ltd.
The company noted that high stockpiles of Chinese commodities, and market uncertainty due to US trade policies had damped seasonal commodity business. Taylor Maritime expects "modest" demand in 2025 for dry bulk shipping, one of its main businesses, "compared to the strong levels seen in 2024", with stricter environmental regulation expected to raise freight costs in the European Union.
Taylor Maritime nonetheless maintained that medium-term outlook was "favourable".
By Holly Munks, Alliance News reporter
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