Knightsbridge may sell two of its supertankers
Knightsbridge Tankers Ltd may sell two of its four supertankers and invest in dry- bulk shipping, betting returns from hauling coal and iron ore will rebound before those for carrying oil, Bloomberg reports. Knightsbridge will 'struggle' to find work for the 1995-built Camden and the Hampstead, dating from 1996, when the tankers' charters expire next year, Ola Lorentzon, chief executive officer, said by phone on Tuesday.
The Hamilton, Bermuda- based company is interested in buying two or three Panamax vessels using mostly cash, he said.
Returns for very large crude carriers are down 93 per cent from the 2007 record of US$229,000 a day and all six companies in the Bloomberg Tanker Index are losing money.
Knightsbridge, which analysts estimate will be profitable this year and next, leases out three of its tankers on multi-year contracts, rather than chasing single-voyage cargoes.
'We were not considered to be a very successful company when the market was $150,000 a day and we were locked in on time charters,' the CEO said.
'Now it's comfortable to have cover. The purchase price of dry-cargo vessels matches the income you can recover on the vessels more than for tankers. It will take more time before the tanker market recovers.'
The company's tankers are commercially managed by Frontline Ltd and its dry-bulk fleet by Golden Ocean Group Ltd, both led by Norway-born billionaire John Fredriksen. Golden Ocean is Knightsbridge's largest shareholder, with a 10 per cent stake resulting from the purchase of two capesize ships in 2010, Mr Lorentzon said.
Knightsbridge will report net income of US$35.1 million for this year and US$30.4 million for 2012, according to the average estimate of two analysts surveyed by Bloomberg. The company has earned money on that basis every year since its founding in 1996.
Frontline plunged 44 per cent in Oslo trading on Nov 22 after saying it was seeking talks with creditors and might breach loan terms. Knightsbridge has slumped 31 per cent to US$15.32 in New York this year, paring its 68 per cent jump in 2010.
The Hamilton, Bermuda- based company is interested in buying two or three Panamax vessels using mostly cash, he said.
Returns for very large crude carriers are down 93 per cent from the 2007 record of US$229,000 a day and all six companies in the Bloomberg Tanker Index are losing money.
Knightsbridge, which analysts estimate will be profitable this year and next, leases out three of its tankers on multi-year contracts, rather than chasing single-voyage cargoes.
'We were not considered to be a very successful company when the market was $150,000 a day and we were locked in on time charters,' the CEO said.
'Now it's comfortable to have cover. The purchase price of dry-cargo vessels matches the income you can recover on the vessels more than for tankers. It will take more time before the tanker market recovers.'
The company's tankers are commercially managed by Frontline Ltd and its dry-bulk fleet by Golden Ocean Group Ltd, both led by Norway-born billionaire John Fredriksen. Golden Ocean is Knightsbridge's largest shareholder, with a 10 per cent stake resulting from the purchase of two capesize ships in 2010, Mr Lorentzon said.
Knightsbridge will report net income of US$35.1 million for this year and US$30.4 million for 2012, according to the average estimate of two analysts surveyed by Bloomberg. The company has earned money on that basis every year since its founding in 1996.
Frontline plunged 44 per cent in Oslo trading on Nov 22 after saying it was seeking talks with creditors and might breach loan terms. Knightsbridge has slumped 31 per cent to US$15.32 in New York this year, paring its 68 per cent jump in 2010.
