Red half year for d’Amico International Shipping
CEO Fiori warns it will take some more quarters before the tanker market recovers
The Board of Directors of d’Amico International Shipping S.A. approved the half-year and second quarter 2018 financial results, that shows a negative result for the Monaco-based company.
“The expected recovery of the tanker market has not started yet. d’Amico International Shipping posted a net loss of US$ 20.2 million in the first half of 2018, hit by a very tough freight market especially in Q2. It is obviously a result we are not happy about but I would like to reiterate once again what I have been saying several times: I see no reason whatsoever why the product tanker market should not pick-up in the medium term” Marco Fiori, Chief Executive Officer of d’Amico International Shipping, commented. “The long-term fundamentals are all there, showing a growing world demand for oil-refined products and limited net fleet growth expected for the next years. In the first six months of the year, few vessels were ordered and demolitions accelerated. The 1e-year TC rate for eco MR vessels stood at US$ 14,000/day (about US$ 1,000 less for non-eco ships) as at the end of June. This has always been the best market indicator in our industry and is significantly above the spot market, indicating operators still expect an improvement in freight rates over the next year.
I think it is just a matter of some quarters before we will see again our market going back to satisfactory levels. In the meantime, we will keep focusing on the key strategic pillars that have made our company successful over decades of activity and across different market cycles. We will continue providing a service second to no-one to our customers (which comprises most of the top oil-majors and leading trading houses), on maintaining the highest quality standard on board our modern vessels whilst keeping an efficient cost structure, securing our financial stability for the years to come, developing our employees and strengthening our organization, priorities which have always
contributed to the success of our company”.
Fiori recalled to are fortunate to have benefited the unwavering support of banks especially since they are getting close to the end of a large fleet renewal program. “We have also received the continuing and precious financial support of our majority shareholder. With regards to our newbuilding program which began in 2012, I can confirm that the prices paid for our assets are still in this extremely negative freight rate environment in most cases below current prices. This is another signal that the actual market cannot last much longer, also because the major regulatory change which will come into force in January 2020, limiting the sulphur content in bunker fuels, is widely expected to generate incremental demand for our vessels already starting in the second-half of 2019”.