Tanker and dry bulk operator Norden saw significant progress in Q1 and maintains its recently upgraded expectations.
The Danish tanker and dry bulk company has seen marked progress in the first quarter compared to the same period last year.
In Q1, Norden saw a profit of USD 117.1m against a deficit of USD 14.9m in the same quarter last year, in which low demand and a high number of ships prompted a historically weak quarter for the tanker market, although this time of the year is usually a high season for the transportation of oil products.
The figures are evident from the company’s quarterly report.
”Great Q1 result based on strong performances in both business units as we continue to capture value in the dry cargo market through vessel sales, profitable cover and by utilising regional market volatility,” says CEO Jan Rindbo in an announcement.
According to the report, the ship sales contributed with a profit of USD 28m.
Revenue soared markedly as well to more than USD 1bn against USD 603.9 in the same period the previous year.
The strong progress comes despite spot rates being at a lower level compared to Q4 2021, it says.
Uncertainty continues
In Q1, Norden furthermore improved the operating result (EBITDA), which increased to USD 211.2m against USD 58.3m in the same period last year.
Although things appear well for Norden in the light of a still strong dry bulk market and a tanker market that may be improving from last year’s horrible period, the company still sees uncertainties in the wake of the Ukraine war as well as the Covid-19 restrictions around the world.
”Given the war in Ukraine, sanctions on Russia, ongoing COVID-19 disruptions and macroeconomic uncertainties, freight market uncertainty and volatility is expected to remain high,” reads the report.
According to Norden, the tanker market was still in bad shape during the most of Q1, but the company sees significant growth in the demand for gas oil, among others, and as a result, the average MR spot rates soared by 49% to 12,600 per day.
However, since April, MR spot rates have increased considerable, it says.
Strengthened tanker market
Just a week ago, Norden upgraded its full-year guidance following a recent improvement of the tanker market.
The strong beginning in the first quarter this year means that the company maintains its expectations.
Previously, Norden expected a result of USD 210-280m. But significant increases in the product tanker rates made the company dial up expectations.
Norden expects to land a 2022 profit of USD 270-350m.
