Avance Gas Holding, the Oslo-based listed VLGC owner, has reported a rise in net profit in 1Q15, helped by a fall in bunker costs.
Group net profit rose to USD23.9 million in three months to 31 March from USD6.1 million in three months to 28 February last year. The company changed its financial year to match the calendar year in 4Q14. Revenues rose to USD48.2 million from USD28.1 million.
The company’s fleet of nine ships continued trading spot and on spot-indexed time charters in the quarter. Time charter equivalent (TCE) earnings were USD40 million in 1Q15 compared with USD34.8 million in the previous quarter.
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“TCE earnings were held down by 11.9 days of off-hire for Thetis Glory and 12 days of off-hire for Monsoon, which was partially offset by the impact of lower bunker fuel prices. The average bunker price paid in 1Q15 was USD323 per ton, compared with USD441 per ton for the three months ended 31 December 2014,” the company said in a statement.
The company has five 83,000 m3 newbuildings on order, all of which are due for delivery this year.
Commenting on the figures, Kurt Waldeland and Erik Nikolai Stavseth, shipping analysts at Arctic in Oslo said, “Our main concern for Avance Gas is still related to timing of the newbuildings and what the potential impact of additional work required to rectify any anomalies.”
“However, as we have seen with Monsoon and Breeze, the work is expected to take no more than one month per vessel – likely less when not launched yet – and hence we will only make marginal adjustments to our estimates. We reiterate our Arctic Buy recommendation and see that the stock trades on 30% plus dividend yield,” they said in a market report e-mailed to IHS Maritime.