Klaveness Combination Carriers Suffers Loss in Q2

combination carrierImage Courtesy: Klaveness

Norway-based shipowner Klaveness Combination Carriers (KCC) ended the second quarter of this year with a net loss.

The company suffered a net loss of USD 1.9 million in Q2 2019, against a net income of USD 3.2 million seen in Q2 2018.

Net revenues from operations of vessels stood at USD 12.6 million in the second quarter of this year, decreasing from USD 14.4 million posted in the corresponding period a year earlier.

As explained, earnings were negatively impacted by fewer days in the main CABU combination trades due to a temporary lower number of caustic soda contract cargoes. What is more, the historically weak dry bulk market during Q1 2019 and early part of Q2 2019 had negative earnings effect on performing dry voyages in the second quarter.

However, despite seasonally low caustic soda volumes, CABU fleet continues to deliver earnings well above the standard markets with earnings 1.3 times the MR-tanker market, KCC said.

Following the delivery in January, the first CLEANBU vessel, MV Baru, has been phased in after the completion of guarantee works in mid-April. It completed its first clean petroleum cargo from India to Singapore as a regular tanker vessel in mid-May and started combination trading at the end of May with the fixture of a CPP cargo from India to Argentina. After discharging CPP in Argentina, Baru recently completed the first switch from tanker to dry bulk mode.

The concluded earnings of the estimated round voyage of 144 days are around USD 20,000/day, 1.5 times a standard LR1 tanker, according to the company.

“We are pleased to report the successful first CLEANBU wet-dry combination voyage with earnings 1.5 times the standard market, proving the superior earnings capacity of our new CLEANBUs,” Engebret Dahm, CEO of Klaveness Combination Carriers ASA, commented.

“While the CABU fleet continues to perform well in the second quarter, KCC’s results reflect ‘one-off introduction costs’ for the CLEANBUs which are expected to be substantially reduced over the coming quarters.”

“Both CABU and CLEANBU earnings are expected to considerably improve in second half of 2019 based on higher caustic soda contract booking and more CLEANBUs in combination trading,” Dahm continued.

The second CLEANBU, MV Barracuda, was delivered in late July and completed first loading as a tanker for shipment of caustic soda in Taiwan on August 23. It is now scheduled to start combination trading in mid-September. The third CLEANBU is expected to be handed over in September and targeted to start combination trading within end of October.

KCC currently has six CLEANBUs on order for delivery from September 2019 to February 2021. The combination carriers are designed to transport clean petroleum products in addition to caustic soda and dry bulk products.

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