Golden Ocean – Dry Bulk Market Has Gone From ‘Bad to Worse’
OSLO, May 28 (Reuters) – Dry bulk transport agency Golden Ocean reported first-quarter earnings beneath forecasts on Thursday and stated its market had gone from “bad to worse” with market circumstances not seen in three a long time.
Golden Ocean, managed by transport tycoon John Fredriksen, stated its made a internet lack of $75.3 million within the first quarter, beneath expectations for a lack of $27 million, the outcome was weighed down by a $141 million impairment cost on its vessels.
Excluding the impairments, the agency made an EBITDA lack of $3.6 million, not removed from forecasts for a $1 million loss.
Its shares had been buying and selling 3.13 p.c decrease at 32.84 Norwegian crowns at 0821 GMT.
The dry bulk transport market has suffered a deep downturn in latest months as China lower its first-quarter coal imports by 42 p.c and markets count on its coal imports to stabilise on the diminished stage.
“The dry bulk market has remained weak so far in the second quarter; consequently the revenues of Golden Ocean are expected to remain low in the second quarter,” the corporate stated in an announcement.
The majority of Golden Ocean’s fleet is uncovered to the spot market or on time constitution contracts linked to the spot market which implies outcomes will proceed to correlate with spot charges.
“The utilisation of the dry bulk fleet was hovering around 80 percent during the quarter and earnings were at levels not experienced since the mid 1980s,” the corporate stated.
It stated the sector usually advantages from world GDP development however its heavy reliance on transporting coal and iron ore to China will increase its vulnerability, particularly as visibility relating to China “at best must be considered as limited”, Golden Ocean stated.
It added that the scrapping of previous vessels outpaced new deliveries within the first quarter, starting what might be a lot wanted structural modifications to the market.
($1 = 7.7492 Norwegian crowns) (Reporting by Balazs Koranyi, modifying by Terje Solsvik)
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