Time Charter Market, via Clarksons (click for larger)

But the results topped estimates, and the company, which recently undertook a restructuring effort, said it expects its second-quarter results to be better than the first.

Shares were up 4.4% in premarket trading to $5.20. Through Thursday’s close, the stock was up 16% so far this year.

The company, which owns and operates oil tankers, added that it won’t be paying out a dividend in the first quarter.

Frontline completed a restructuring of its business late last year, selling 15 of its wholly-owned special-purpose companies to create a new company, Frontline 2012 Ltd., which it will manage through a subsidiary. Following the restructuring, the company reduced its operating fleet to 48 vessels from 58 vessels.

Frontline reported a first-quarter profit of $7.18 million, or 9 cents a basic share, down from $15.5 million, or 20 cents a share, a year earlier. The latest quarter included a loss of $2.2 million on the sale of a double hull tanker and a $9.4 million gain from the termination of the charter party for a single hull carrier.

Operating revenue dropped 29% to $167.3 million, while operating expenses fell 26%.

Analysts surveyed by Thomson Reuters had seen a loss of 10 cents on revenue of $91 million.

-By Kristin Jones; Dow Jones Newswires

Image courtesy Ship Finance International

(Dow Jones) Ship Finance International Ltd.’s (SFL) first-quarter profit rose 21% on a stronger performance in the tanker market.

The company, which operates large vessels for the transport of crude oil, had seen a weaker tanker market and higher expenses weigh on profits in recent months. But the spot tanker market rebounded at the end of the fourth quarter of 2011, and the latest quarter outperformed the preceding two quarters.

Ship Finance recently agreed to end its chartering agreements with Horizon Lines Inc. (HRZL) under an agreement that makes Ship Finance a large stakeholder in the ocean shipping company.

Following the deal, Ship Finance now has seven container vessels in the spot market, said Chief Executive Ole B. Hjertaker. Given the changed profile of its container business, the company is evaluating structural alternatives to maximize its value, he said, including carving out the container business into a separate entity.

Ship Finance said in March that Chief Financial Officer Eirik Eide would leave in the second quarter after a two-year stint to join another shipping company. He will be replaced by Senior Vice President Harald Gurvin.

For the latest period, Ship Finance posted a profit of $39 million, or 49 cents a basic share, up from $32.1 million, or 41 cents a share, a year earlier.

Operating revenue increased 17% to $84.1 million.

Analysts polled by Thomson Reuters recently expected per-share earnings of 40 cents on revenue of $116 million.

Operating expenses rose 11% to $38.1 million.

Shares closed Wednesday at $13.83 and were mostly inactive premarket. The stock is up 48% so far this year.

-By Kristin Jones; Dow Jones Newswires

Ingmar den Blanken, Treasurer of Fairstar negotiated the deal with the banks and provided the following additional details, “The facility has a one year term and is priced for the first nine months at LIBOR plus 400 basis points, rising to LIBOR plus 600 basis points after nine months. In addition to providing the funds we need to pay our obligations for the FORTE and FINESSE, it re-finances the current loans we have with HSH Nordbank and ABN AMRO. The banks will hold first mortgages over the Fairstar fleet once funding has been made. While the terms are not nearly as attractive as the DNB Bank facility we signed last year, in light of the recent disruption to our business caused by Dockwise, we are pleased to be able to satisfy our obligations to GSI as well as our obligations to our “red box” clients.”

Philip Adkins, Chief Executive Officer of Fairstar provided further elaboration:

“We were very clear to the market last week that the payments we are obliged to make will be made and the performance bonds we are obliged to issue will be issued. At Fairstar, we keep our promises. Fairstar is a very valuable company.

It is clear to the market that Dockwise has been trying to talk down the value of our business in order to acquire it at the cheapest possible price. Their most recent tactic was to suggest in their stock exchange release that Fairstar was unable to honour our financial commitments. Behind the scenes, they have also tried to intimidate our Directors and mislead our clients. We continue to believe that hostile and dirty tactics are not in the best interests of creating value for all of our stakeholders. The fact that they exploited the financial instability of one of our large shareholders (Oceanus) and the naiveté of others in order to acquire a large stake in Fairstar, before making their intentions public, has nothing to do with the value of our business.

More importantly, the accretive value of our business to Dockwise has been completely overlooked in their Offer Document. We have invited representatives of Dockwise to meet with Fairstar and discuss in a constructive way how best to end the current hostile stalemate. Now that our financial obligations have been met, Dockwise must be prepared to address the facts that 46% of our shareholders have not accepted the NOK 9.3 “offer” and Fairstar’s shares have been consistently trading above that level since the attack on Fairstar began. Our clients have been very uncomfortable with the tactics that have been used by our competitor. It seems inappropriate to suggest to our partners that Fairstar needs to be saved by Dockwise. I am certain our clients knew what they were doing when they chose to award almost USD 300 million in contracts to Fairstar. The Fairstar Boards are preparing a formal rebuttal to the Offer Document that is now in circulation. In the meantime our invitation for a constructive dialog goes unanswered.”

Image courtesy Tidewater

(Dow Jones) Tidewater Inc.’s (TDW) fiscal fourth-quarter earnings soared from a year-earlier quarter weighed down by heavy charges, while higher utilization and rates for the company’s vessels also propped up results.

Tidewater, which provides marine services to the oil and gas industry, had seen growing expenses–including high-priced fuel, as well as interest costs–pressure its bottom line. The company has been upgrading its fleet of vessels, which serves the international offshore energy industry.

For the quarter ended March 31, Tidewater’s profit rose to $33.6 million, or 66 cents a share, up from $12 million, or 23 cents a share, a year earlier. The year-ago period included $6.3 million in charges from a settlement with the government of Nigeria, a $3.9 million impairment charge related to the value of vessels and parts expected to be sold to a scrap dealer, and a higher income tax rate.

Revenue jumped 14% to $289.4 million.

Analysts polled by Thomson Reuters recently projected earnings of 61 cents a share on revenue of $286 million.

Operating margin grew to 16.1% from 9.8%.

Vessel operating costs grew 9.9% to $289.4 million, while general and administrative costs fell 1.8% to $40.8 million.

Average day rates were up 16% from a year earlier, and worldwide fleet utilization rose to 65.4% from 62.8%.

Shares closed Friday at $45.39 and were mostly inactive premarket. The stock is down 7.9% so far this year.

-By Kristin Jones, Dow Jones Newswires

The FJELL transporting the Perro Negro jackup, image courtesy Fairstar

Fairstar Heavy Transport N.V. (FAIR) announced today the award of  a new contract to transport the jack-up drilling rig OFFSHORE VIGILANT from Port of Spain, Trinidad to Vung Tau, Vietnam on Fairstar’s semi-submersible vessel FJELL. The contract value is USD $2.9 million and the loadout is expected to commence at the end of MAY.

Willem Out, COO of Fairstar, commented:

“It is business as usual at Fairstar. This voyage positions FJELL almost perfectly to be in the Far East just in time to begin her work on the Gorgon contract in August. Once the rig has been safely discharged, we will put FJELL into dry-dock and prepare the ship for Gorgon certification.”

FJELL has just safely discharged two concrete power generating barges for the Chevron EGTL project in Escravos, Nigeria and is en route to Port of Spain.

Facing a hostile takeover by heavy lift giant Dockwise, business at Fairstar appears anything but “usual” however.

In another announcement today, Fairstar informed Dockwise:

The unsolicited financial proposal received from Dockwise is of no interest to Fairstar. Dockwise has attempted to characterize the offer of USD 30 million in “subordinated debt” to be an attempt by Dockwise to be helpful. However, a close reading of the Dockwise proposal revealed it to be another opportunistic device to try and lock in a NOK 9.3 ceiling for Fairstar shares. Fairstar does not consider “poison pills” of any sort to be appropriate tools in the proper management of our Stakeholders’ interests.

Fairstar’s comments stem from Dockwise’ statement,

“The financial situation of Fairstar is concerning and therefore at the AGM, Dockwise offered again to the Fairstar Boards to discuss how Dockwise could assist Fairstar with its financing. Dockwise had before repeatedly stated to the Fairstar Boards that it is willing and able to discuss with Fairstar the terms of required financing including a potential capital injection of USD 50-100 MM.”

Which was then followed by Dockwise’s offer,

“To assist in Fairstar’s short term financing needs by providing a USD $30 million subordinated loan, for a period of up to 3 years, with interest of 1% over LIBOR for the first 2.5  months and 6% over LIBOR thereafter, to bridge the period to an equity offering of between 20 and 60 million shares, at NOK 9.30, with full protection of the pre-emptive and other rights of all the Fairstar shareholders.  The proposed USD $30 million short term financing would be part of the potential overall capital injunction by Dockwise of USD $50-100 million referred to above.”

Image: Fairstar

Dockwise, via their wholly-owned subsidiary Dockwise White Marlin B.V., announced today the unconditional mandatory offer for all the issued and outstanding shares of Fairstar Heavy Transport N.V. (“Fairstar”) at a price of NOK 9.30 per Fairstar share.

The offer price represents a premium of more than 22 percent compared to the closing price of the Fairstar shares on Oslo Børs on 20 April 2012, which was the last trading day prior to the announcement of Dockwise’s agreements to acquire approximately 54 percent of the shares in Fairstar.  Whether intentional or not, this announcement comes on the back of Fairstar’s Annual General Meeting (AGM), held yesterday.

Frits van Riet, Chairman of Fairstar’s Supervisory Board comments on yesterday’s AGM:

In spite of having made it perfectly clear to Dockwise/White Marlin early last week that their participation was welcome and all of their rights and voting powers would be recognized, they attempted to stop the meeting by going to Court in the Netherlands. When they came to the realization that they would not succeed in frustrating our commitment to proper corporate governance, they withdrew their case and attended the AGM this morning. Unfortunately, in spite of our desire to enter into a constructive dialog, Dockwise/White Marlin decided to use the occasion to vote against all of the resolutions on the Agenda with one exception (the appointment of KPMG as the auditors of the Company). While this is not a surprise, it continues to raise our concerns that the opportunistic and hostile approach by Dockwise/White Marlin must be regarded with concern.

The offer period in Dockwise’s Mandatory Offer runs from and including 15 May 2012 to 17:30 hours (CET) on 12 June 2012, and may be extended by up to two weeks.

Dry-bulk shipper Navios Maritime Holdings Inc. (NM) is the principal shareholder and sponsor of Navios Acquisition, which owns and operates tanker vessels that transport petroleum products and bulk liquid chemicals.

S&P affirmed Navios Acquisition’s corporate credit rating of B, which is five steps into junk territory.

But the ratings company said the pressure on Navios Acquisition’s earnings and credit measures has increased, due to an uncertain industry outlook and the company’s higher debt from the recent acquisition of new vessels.

S&P said it could revise Navios Acquisition’s outlook to stable if it observes a gradual market recovery and if the company’s cash flow improves.

On Tuesday, Navios Acquisition reported its first-quarter loss widened as higher direct vessel expenses masked its 42% revenue growth. The company has a fleet of 29 tanker vessels with 15 vessels in the water for 2012. The company has said it believes it can generate additional cash flow in the current rate environment even if there is no recovery in the market.

Shares closed Thursday at $2.80 and were inactive premarket. The stock is up 4% since the start of the year.

-By Melodie Warner, Dow Jones Newswires

The wider first-quarter loss was due to the restructuring process the company is completing, which started in the second quarter of 2011, the Vapores said.

Vapores, Latin America’s largest shipper, issued 630 million new shares and raised $129 million in January, the last part of a $1.2 billion capital increase aimed to improve its financial situation after surging fuel costs and lower shipping rates deteriorated its 2011 results.

As part of its restructuring process, Vapores also split off its port-operator unit Sociedad Matriz SAAM SA (SMSAAM.SN) into a separate publicly traded company earlier this year.

Vapores’s first-quarter operating revenue decreased to $832 million from $1.45 billion a year earlier.

The company ended March with $523 million in cash and cash equivalents compared with $173 million at the end of 2011.

Vapores is controlled by the local Luksic family, through their Quinenco SA(QUINENCO.SN) holding company, and the local Claro family, through Maritima de Inversiones SA (MARINSA.SN) holding company.

-By Graciela Ibanez, Dow Jones Newswires

Image courtesy Wilh. Wilhelmsen

In the face of extraordinary challenges faced by the global shipping industry, Norwegian maritime conglomerate, Wilh. Wilhelmsen Holding ASA (WWI.OS), posted an 84% rise in year-on-year profit on Thursday.  Their Board maintains a cautiously optimistic view on medium term prospects however, warning that prospects will depend on developments in the world economy.

MAIN FACTS:

• Insufficient demand of global dry seaborne activity in recent months has translated into underutilization of the global shipping capacity, as a persistent supply of new vessels enter the market.
• This is particularly severe with the larger size tonnages.
• As one of the market participants in dry bulk market, the company is exposed to the current low freight rate environment mainly due to an oversupply of tonnages, and therefore had to enter into some loss-making charter contracts in early 2012 as part of its fleet is due for contract renewal in the prevailing market conditions.
• Further details of the financial information of the company will be disclosed in its first quarter results announcement in late May 2012.
• At 0920 GMT shares traded 12% lower at NOK9.01.

-By Dominic Chopping; Dow Jones Newswires