Ardmore expects product tanker demand to rise

Aug 02 2019


Ardmore Shipping Corp has reported a net loss of $3.4 mill for the three months ended 30th June, 2019, compared to a net loss of $8.2 mill for 2Q18.

Reported a GAAP net loss was $9.9 mill, compared to a GAAP net loss of $8.6 mill for 2Q18. The 2Q19 GAAP net loss included the loss on the sale of the ‘Ardmore Seafarer’.

The company also reported adjusted EBITDA of $12.3 mill for 2Q19, compared to $8 mill for the same period of ,2018.

For the first six months of this year, Ardmore reported a net loss of $5.9 mill, compared to a net loss of $13.3 mill for 1H18. GAAP net loss was $19.1 mill, compared to a GAAP net loss of $13.7 mill for 1H18.

The 1H19 GAAP net loss included the loss on the sales of the ‘Ardmore Seatrader’, ‘Ardmore Seamaster’ and ‘Ardmore Seafarer.’

Adjusted EBITDA for 1H19 was $25.9 mill, compared to $17.9 mill for 1H18.

The company’s MRs earned an average TCE rate of $14,892 per day for 2Q19, and $15,306 per day for the six month period, while the chemical tankers earned an average TCE rate of $12,830 per day for 2Q19, and an average of $12,529 per day for 1H19.

Anthony Gurnee, Ardmore’s CEO, commented: “We are pleased with our performance in the second quarter during what was expected to be a softer period as compared to the prior period’s winter market conditions. The second quarter reflected a typical seasonal decline marked by notably high refinery maintenance levels, with refineries frontloading maintenance in preparation for increased throughput during the second half of 2019 to meet demand for IMO2020-compliant low sulfur fuels.

“Industry-wide preparations for IMO 2020 implementation are unfolding as expected; marine fuel providers are commencing clean-up of their logistics infrastructure and are preparing to stockpile low sulfur fuels in large quantities ahead of the switch-over, which so far is very limited in quantity but is expected to be in full-swing in September.

“One consequence of IMO 2020 preparations already is pricing and availability of HSFO, which is being impacted by reduced storage and barging capacity, as some capacity is already being taken out of service for the switchover to VLSFO. Overall, we estimate that the increases in refinery throughput and heightened oil trading activity will result in a roughly 5% additional layer of product tanker demand commencing in the next few months with the potential to last up to two years before markets reach equilibrium.

“In keeping with our ongoing commitment to environmental stewardship, we are commencing reporting our CO2 emissions this quarter. Beyond owning and operating a modern ‘eco’ fleet, we have maintained a strict focus on fuel efficiency and environmental best practices throughout the company’s history. We believe that a commitment to increased transparency by companies such as Ardmore will play an important role in encouraging positive and sensible legislative change toward reducing greenhouse gas emissions from the shipping industry,” he concluded.

 



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