{"id":5320,"date":"2020-02-28T03:28:01","date_gmt":"2020-02-28T00:28:01","guid":{"rendered":"https:\/\/www.al-sindbad.net\/pacific-basin-eyes-further-second-hand-acquisitions-staying-clear-of-newbuilds\/5320\/"},"modified":"2020-02-28T03:28:01","modified_gmt":"2020-02-28T00:28:01","slug":"pacific-basin-eyes-further-second-hand-acquisitions-staying-clear-of-newbuilds","status":"publish","type":"post","link":"https:\/\/www.al-sindbad.net\/pacific-basin-eyes-further-second-hand-acquisitions-staying-clear-of-newbuilds\/5320\/","title":{"rendered":"Pacific Basin Eyes Further Second-Hand Acquisitions, Staying Clear of Newbuilds"},"content":{"rendered":"

Hong Kong-based dry bulk shipping company Pacific Basin is keen on enlarging its fleet, but is staying clear from ordering newbuilds keeping a focus on smaller second-hand bulkers.<\/strong><\/p>\n

\u201cWe will continue to pursue our fleet growth and renewal strategy. Over the long term, we see upside in secondhand <\/em>values and our buying focus remains on secondhand Japanese-built ships for their good quality and value,\u201d <\/em>the company said announcing its business performance results for 2019.<\/p>\n

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The shipowner said it would avoid contracting newbuildings due to their high price, low return, and because of the uncertainty over new environmental regulations and their impact on future vessel designs and technology.<\/p>\n

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\u201cIn the short term, what the industry can and should do to improve profitability and reduce emissions is to slow down existing ships and refrain from ordering new ships with old technology.\u201d<\/em><\/p>\n

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The company posted a net profit of USD 25.1 million in 2019, an underlying profit of USD 20.5 million and EBITDA of USD 230.7 million. This is considerably lower from the corresponding figures in 2018, when the company\u2019s net profit stood at USD 72.3 million with an underlying profit of USD 72 million.<\/p>\n

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\u201cOur results benefited from our TCE earnings outperformance, enlarged owned fleet and competitive cost <\/em>structure, but were adversely affected by weaker dry bulk market conditions and more off-hire than normal, especially in the second half of the year, due to scrubber installations and a record number of dry-dockings,\u201d<\/em> Mats Berglund, CEO of Pacific Basin, said.<\/p>\n

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During 2019, the company took delivery of eight secondhand vessels \u2013 six Supramax and two Handysize \u2013 and sold two older smaller Handysize vessels. By the end of April 2020, two further Supramaxes and one Handysize are scheduled to join the company\u2019s fleet, pushing its owned fleet to 117 ships.<\/p>\n

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On the other hand, Pacific Basin is reducing the number of ships on long-term charter, from 61 at the end of 2012 to around 18 on average for 2020.<\/p>\n

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Commenting on its approach to meeting the IMO 2020 sulphur cap, the bulker owner said that about 85% of its overall fleet (including chartered ships) complies by using low-sulphur fuel.<\/p>\n

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\u201cOur ships have made the switch without any major unplanned operational disruption, as we prepared thoroughly,\u201d<\/em> the dry bulk shipping major said.<\/p>\n

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\u201cAs Supramax vessels consume more bunkers than Handysize vessels, we chose a balanced approach to how we <\/em>comply, took early actions to prepare for the expected volatility in fuel prices in early 2020 and installed exhaust gas <\/em>scrubbers on a majority of our owned Supramax vessels allowing these ships to burn cheaper heavy fuel oil.\u201d<\/em><\/p>\n

<\/p>\n

The company completed its scrubber installation program in February, with scrubbers fitted and operational on 28 of its 35 owned Supramaxes.<\/p>\n

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\u201cHaving scrubbers on about 15% of our approximately 200 operated ships provides us some optionality in how we manage our fuel needs to comply with the new rules. Based on the fuel price spreads seen in early 2020, our scrubber-fitted ships are making a significant contribution to our earnings,\u201d<\/em> the company added.<\/p>\n

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Commenting on the market outlook, Pacific Basin sees positive developments including subsiding of tensions between the US and China as well as normalization of ore exports from Brazil and Australia following last year\u2019s infrastructure and weather disruptions.<\/p>\n

world maritime news<\/p>\n","protected":false},"excerpt":{"rendered":"

Hong Kong-based dry bulk shipping company Pacific Basin is keen on enlarging its fleet, but is staying clear from ordering newbuilds keeping a focus on smaller second-hand bulkers. \u201cWe will continue to pursue our fleet growth and renewal strategy. Over the long term, we see upside in secondhand values and our buying focus remains on …<\/p>\n","protected":false},"author":1,"featured_media":5321,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[64],"tags":[2200,2198,2202,1498,1381,249,2199,2201],"class_list":["post-5320","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-maritime-news","tag-acquisitions","tag-basin","tag-clear","tag-eyes","tag-newbuilds","tag-pacific","tag-secondhand","tag-staying"],"_links":{"self":[{"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/posts\/5320","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/comments?post=5320"}],"version-history":[{"count":0,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/posts\/5320\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/media\/5321"}],"wp:attachment":[{"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/media?parent=5320"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/categories?post=5320"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.al-sindbad.net\/rest\/wp\/v2\/tags?post=5320"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}