J. Lauritzen (JL) has released its third quarter financial results, stating that the market has been more challenging than expected.
EBITDA for the first nine months of 2014 stood at $72.6 million, up $25.6 million for the same period in 2013.
The third quarter EBITDA result stands at a loss of -$2.1 million, which the company says is significantly down on the second quarter of 2014.
Net profit for the first nine months of 2014 worked out at $16.3 million. This is in comparison to the -$265.3 million in the same period of last year.
After the end of the third quarter committed post-delivery financing of the company’s newbuilding program was received and two capsize bulk carriers were sold at a profit of $9 million. Overall JL’s cash position improved by $27 million. At the end of the period cash and unused credit facilities amounted to $280 million. The company estimates full year EBITDA to be at $50 - 65 million, down from the earlier reported $65 - 80 million. Net profit is expected to be in the range of -$5 - $10 million
According to JL's financial statement, 2014 has been challenging, and there’s going to be no change for 2015.
"Market conditions in Q3 have turned out considerably weaker than expected when JL released its report for the first six months of 2014. The economic and geopolitical forces shaping demand for bulk and gas carriers have continued weakening and hence led to a gloomier rate outlook for Q4 and the beginning of 2015.
"Falling crude oil prices have reduced bunker prices and thus reduced the incentive to slowsteam, which is assessed to have effectively increased the supply of tonnage.
"Looking further ahead, a modest upturn in the market is possible in the short to medium term, however with a very high likelihood of low markets continuing throughout 2015 and we thus anticipate a 2015 with challenges similar to those experienced in 2014.