Lower Rates Dent OSG’s Q1 Profit

Image Courtesy: OSG

US-based oil tanker company Overseas Shipholding Group (OSG) had a challenging start of the year reporting a slashed net income of USD 5.4 million for the quarter ended March 31, 2017, compared to USD 50.7 million a year earlier.

However, net income for the prior year period included income from discontinued operations from International Seaways (INSW) of USD 59.4 million.

OSG split its business into two independent publicly traded companies through the spin-off of its then wholly owned subsidiary INSW on November 30, 2016. OSG retained the U.S. Flag business and INSW holds entities and other assets and liabilities that formed OSG’s former International Flag business.

During the first quarter of this year, the company’s shipping revenues were also affected by lower charter rates reaching USD 108.1 million, a decrease of 6.1% from USD 115.1 million in the prior year quarter.

Time charter equivalent (TCE) revenues for the quarter were USD 102.3 million, down 8.8% compared to the same period in 2016, OSG said in its quarterly report, while the tanker owner’s adjusted EBITDA was USD 36.2 million, dropping by 11.2% from last year’s USD 40.7 million.

“We had a solid first quarter to start 2017 despite ongoing challenging market conditions. Although we experienced lower charter rates, our ability to attain high utilization rates throughout the first quarter helped drive revenue,” Sam Norton, OSG’s President and CEO said.

“Our diverse operating platform, which includes shuttle tankers in the U.S. Gulf Coast, the only licensed operator of lightering vessels in the Delaware Bay, and the only operator of tankers in the Maritime Security Program (“MSP”), provides stability against market volatility affecting other areas of our business. Additionally, we are starting to see results of efforts to be more efficient with general and administrative costs. This helped reduce expenses which drove higher operating income,” he added.

Pursuant to a final decree and order of the bankruptcy court, OSG said that it has closed its bankruptcy case.

OSG has 24 vessels in its fleet, comprising eight ATBs, two lightering ATBs, three shuttle tankers, nine MR tankers, and two non-Jones Act MR tankers.

Share this article

Follow World Maritime News

In Depth>

Events>

<< Jan 2018 >>
MTWTFSS
1 2 3 4 5 6 7
8 9 10 11 12 13 14
15 16 17 18 19 20 21
22 23 24 25 26 27 28
29 30 31 1 2 3 4

APM – ASIA PACIFIC MARITIME 2018

27 years in the making, APM is the premier shipbuilding & marine, workboat and offshore exhibition in Asia trusted by generations of industry professionals.

read more >

Mega Cargo Show 2018

The focus of the event is to bring all connected with cargo fraternity on a single platform…

read more >

Vietship 2018

Vietship is the largest and longest established exhibition in Vietnam featuring all aspect of Shipbuilding, Shipping and Offshore Technology.

Since its first event in 2002, Vietship has become the convergence and platform of advanced technologies regional and worldwide in shipbuilding and ship repair, marine equipment, waterway transportation and services, marine and offshore engineering.

After 16 years of eight consecutive editions, Vietship has affirm itself as an important event in enhancing cooperation and development, attracting investments, exchanging technology and creating ideal opportunities for trade promotion in the international maritime industry.

More info

read more >

LNG Bunkering Summit 2018

The conference will cover the obstacles facing both the shipping and port communities, exploring developments in conversion and new builds…

read more >