Thu 3 Feb 2011, 13:22 GMT

Aegean expecting Q4 2010 loss


Supplier says it expects to post a net loss of US$12-13 million for the fourth quarter of 2010.



Aegean Marine Petroleum Network Inc. has today announced that it expects to report a net loss of between $12.0 million and $13.0 million, or between $0.26 and $0.28 basic and diluted loss per share, for the fourth quarter of 2010.

On an adjusted basis, which excludes $1.8 million in unrealized foreign exchange losses, the company expects to report a net loss between $10.2 million and $11.2 million, or between $0.22 and $0.24 basic and diluted loss per share.

During the same three month period, the volume of marine fuel sold is expected to total approximately 2.9 million metric tonnes and the gross spread of marine fuel sold is expected to range between $15.5 and $16.0 per metric tonne.

Commenting on the news Nikolas Tavlarios, President, commented, "Results for the fourth quarter of 2010 reflect continued competition in our largest markets and ongoing softness in the maritime industry, which has led to a gross spread below our expectations. Our preliminary results also reflect higher operating expenses related to our bunkering delivery fleet. While we improved gross spread and returned to profitability during the months of December and January, management continues to take proactive measures to increase sales volumes at higher margins and drive future performance. Specifically, we plan to launch operations in Cape Verde, strategically located off the coast of Western Africa along major trade routes, in the first quarter. We also intend to enter two new additional startup markets with attractive growth potential by the end of the second quarter and third quarter of 2011, respectively, to further strengthen Aegean Marine's geographical sales mix. Additionally, we expect to commence operations in the first of the three new onshore storage facilities during the second half of 2011 in Tanger Med, Morocco, capitalizing on the increasing demand for onshore storage, enhancing our purchasing power for marine fuel and generating leasing income from third parties."

Tavlarios added, "Complementing these efforts, we remain focused on improving our cost structure and increasing fleet utilization. Consistent with these important objectives, we intend to monetize two or three of our older non-core bunkering vessels and divest at least two of our five floating storage facilities by the end of the year. We also expect to redeploy additional bunkering tankers from their existing locations to other markets within our global network to optimize our performance. While market conditions across the global marine fuel supply industry remain challenging, we believe both the positive long-term industry fundamentals and Aegean Marine's growth prospects remain intact. With significant access to capital and a vertically integrated energy logistics chain, both core differentiators, Aegean Marine is well positioned to emerge from the current downturn as a stronger Company."

Spyros Gianniotis, Chief Financial Officer, stated, "Aegean Marine's strong capital structure, with more than $700 million in working capital credit facilities, enables our Company to manage fluctuating marine fuel prices and procure large quantities of supply at a discount relative to our competitors. We continue to work closely with our banking group with the goal of expanding our lending facilities under favorable terms."

Gianniotis continued: "In addition, we expect to increase the Company's voyage revenues in the current first quarter. By chartering-out five double-hull bunkering tankers on short-term contracts with high credit quality counterparties, we will add to our revenues line while we ensure a level of stability in our expenses."


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