Danish shipping company J. Lauritzen has completed the sale of its stake in Hafnia Tankers Ltd. as the company decided to abandon the product tanker and offshore service segments during the first quarter of 2016.
The company also sold its stake in Axis Offshore Pte. Ltd., which is scheduled to be completed in the third quarter of 2016.
The shares owned in the two companies were sold to LF Investment, a company fully-owned by Lauritzen Fonden, the company said, adding that these were “non-strategic assets” for J. Lauritzen.
In February 2016, the Oslo-listed company secured a cash injection of some USD 19 million from Lauritzen Fonden in order to strengthen J. Lauritzen’s balance sheet and improve its cash position.
The transactions provided J. Lauritzen with additional cash of USD 125 million during 2016 as the assets have a combined book value of USD 105.9 million.
“Previously advised transfers of certain non-strategic assets and obligations to LF Investment ApS were largely completed during Q1. These transactions have together with a capital injection strengthened our balance sheet and improved our cash position,” Jan Kastrup-Nielsen, President and CEO said.
“Dry cargo markets remained under severe pressure and on average Q1 reached an unprecedented low level, whereas the gas carriers performed largely as expected,” he added.
During the first quarter of 2016, J. Lauritzen reported a net loss of USD 8.3 million against a net loss of USD 27 million seen in the same period a year earlier.
EBITDA for the first three months amounted to USD 17.2 million against USD 9.5 million in the first quarter of 2015, mainly attributed to dry bulk market developments.
Total operating loss for the quarter amounted to USD 25.6 million compared to a loss of USD 20.3 million in same period in 2015.
Regarding the outlook for 2016, the company said that “the full year estimate is unchanged. For the remainder of the year there is still a high degree of uncertainty related mainly to the development in the dry bulk segment and hence to the global economy in general. Currency and interest rate fluctuations as well as effects from sale of assets, if any, may impact the result.”
J. Lauritzen held a 5.3 percent stake in Hafnia Tankers, which operates a fleet of some 35 tankers, ten of which were bought from J. Lauritzen in October 2013.