Thu 28 Jan 2010 13:02

Barge operator posts $4.2 million net loss


$7.8m drop in net income is attributed to a reduction in net utilization related to the retirement of its single-hull vessels.



US barge operator K-Sea Transportation Partners L.P. has announced that the company recorded a net loss of $4.2 million for the three months ended 31st December 20009 - a decrease of $7.8 million compared to the net income of $3.6 million it achieved during the corresponding period in 2008.

The company reported an operating income of $1.3 million for the last three months of 2009, a decrease of $8.1 million, compared to $9.4 million of operating income for the three months ended December 31, 2008.

Earnings before interest, taxes, depreciation and amortization (EBITDA), decreased by $7.2 million, or 31%, to $15.9 million for the three months ended December 31, 2009, compared to $23.1 million in 2008.

K-Sea said the decrease in EBITDA resulted from an $11.4 million decrease in revenue, net of voyage expense, which was attributable to fewer working days due to the retirement of a majority of the company's single-hull vessels and an overall reduction in net utilization directly relating to expiring contracts, and having to employ vessels in the spot market.

"Due to customer preference for double-hull vessels, we have taken a majority of our single-hull vessels out of the market and have either retired or sold them," K-Sea said.

The EBITDA decrease was partially offset by a $3.3 million reduction in vessel operating expenses and a $0.9 million reduction in general and administrative expenses, said to have been achieved mainly as a result of cost reduction initiatives.

Six Months Ended December 31, 2009

For the six months ended December 31, 2009, K-Sea achieved a net loss of $9.4 million - a decrease of $16.9 million compared to net income of $7.5 million for the six months ended December 31, 2008.

The decrease was said to be a result of the $11.7 million decrease in EBITDA and a $5.3 million increase in depreciation and amortization expense resulting from the vessel impairment loss mentioned above, offset by a $1.9 decrease in interest expense due to lower average debt balances and interest rates compared to the six months ended December 31, 2008.

The company reported operating income of $0.04 million, compared to $19.2 million of operating income for the six months ended December 31, 2008. Operating income was said to have been negatively impacted by a $5.9 million asset impairment charge on its single-hull vessels.

EBITDA decreased by $11.7 million, or 25%, to $34.1 million for the six months ended December 31, 2009, compared to $45.8 million for the six months ended December 31, 2008. The decrease in EBITDA resulted from a $15.5 million decrease in net voyage revenue, which as mentioned above was said to be attributable to fewer working days due to the retirement of a majority of its single-hull vessels and an overall reduction in net utilization directly relating to expiring contracts and having to employ vessels in the spot market.

Commenting on the results, President and CEO Timothy J. Casey said, "U.S. refinery utilization has declined to levels not seen over the past 20 years, excluding periods of hurricane-related closures. As period charters for a number of our vessels have expired, market conditions have precluded new period charters and forced more vessels into a weaker spot market. Vessel utilization in our second fiscal quarter is about the lowest we have experienced in the last ten years. Accordingly, we will continue to focus on servicing our customers safely and efficiently, while doing our best to maximize both our revenue and our margins. In light of the current utilization, we will continue to reduce costs, rationalize assets, as well as using available capacity to enter adjacent markets. At the same time we expect to apply all free cash flow to reduce debt. We believe strongly in the quality and value of our fleet, as well as our leadership position in the markets we serve, and expect K-Sea to benefit appropriately when refined petroleum products markets strengthen.

"Owing to the uncertain industry outlook, our Board determined that K-Sea and its unitholders would be best served by applying our available cash flow to reduce debt. We therefore did not declare a distribution with respect to our second fiscal quarter, and will reinstate the distribution when we regain visibility in our future results."


Marius Kairys, CEO of Elenger Sp. z o.o. Elenger enters Polish LNG bunkering market with ferry refuelling operation  

Baltic energy firm completes maiden truck-to-ship LNG delivery in Gdansk.

Samsung Heavy Industries (SHI) virtual reality (VR) training program developed in collaboration with Evergreen. SHI develops VR training solutions for Evergreen's methanol-fuelled ships  

Shipbuilder creates virtual reality program for 16,500 TEU boxship operations.

Illustratic image of Itochu's newbuild ammonia bunkering vessel, scheduled for delivery in September 2027. Itochu orders 5,000 cbm ammonia bunker vessel  

Japanese firm targets Singapore demonstration after October 2027, with Zeta Bunkering lined up to perform deliveries.

Bunkering of the Glovis Selene car carrier. Shell completes first LNG bunkering operation with Hyundai Glovis in Singapore  

Energy major supplies fuel to South Korean logistics firm's dual-fuel vessel.

Orient Overseas Container Line (OOCL) vessel. CPN delivers first B30 marine gasoil to OOCL in Hong Kong  

Chimbusco Pan Nation claims to be first in region to supply all grades of ISCC-EU certified marine biofuel.

The Buffalo 404 barge, owned by Buffalo Marine Service Inc., performing a bunker delivery. TFG Marine installs first ISO-certified mass flow meter on US Gulf bunker barge  

Installation marks expansion of company's digitalisation programme across global fleet.

Sogestran's fuel supply vessel, the Anatife, at the port of Belle-Île-en-Mer. Sogestran's HVO-powered tanker achieves 78% CO2 reduction on French island fuel runs  

Small tanker Anatife saves fuel while supplying Belle-Île and Île d'Yeu.

Crowley 1,400 TEU LNG-powered containership, Tiscapa. Crowley deploys LNG-powered boxship Tiscapa for Caribbean and Central American routes  

Vessel is the third in company's Avance Class fleet to enter service.

The inland LNG bunker vessel LNG London. LNG London completes 1,000 bunkering operations in Rotterdam and Antwerp  

Delivery vessel reaches milestone after five years of operations across ARA hub.

The M.V. COSCO Shipping Yangpu, China's first methanol dual-fuel containership. COSCO vessel completes maiden green methanol bunkering at Yangpu  

China's first methanol dual-fuel containership refuels with green methanol derived from urban waste.


↑  Back to Top