Gulf Navigation Holding PJSC (GULFNAV), Dubai’s only publicly traded oil-tanker owner, said losses in 2011 narrowed as expenses related to asset sales declined.
The loss narrowed to 73 million dirhams ($20 million) from 237 million dirhams a year earlier, the company said in a statement to the Dubai bourse today. Expenses related assets held for sale or disposed of declined to 25 million dirhams from 211 million dirhams a year earlier. Revenue fell 18 percent to 256 million dirhams due to the removal of income from its Probos fleet and low Very Large Crude Carrier freight rates.
Reduced charter rates because of an oversupply of ships have lowered the value of vessel fleets, while funding is harder to obtain as capital pressures spur banks to withdraw from ship financing, according to Fitch Ratings. The surplus will probably last through next year as demand stagnates and vessels ordered in 2008 leave yards, the agency said in a March 29 report.
Last year was “a very difficult and challenging year for all sectors of the shipping industry,” Gulf Navigation Chairman Abdullah Al Shuraim said in the statement. “The company remains focused on the key strategic targets that we have set ourselves; in particular the continued expansion of the VLCC fleet as part of a new Saudi VLCC company, and re-alignment of the organization.”
Gulf Navigation’s talks with potential equity partners to invest in its Saudi venture are progressing, it said. The company plans to expand its VLCC fleet to nine vessels and chemical tankers to 12 ships.
Gulf Navigation shares have gained 66 percent this year after losing 49 percent last year.