Second Gaza Relief Aid Ship Leaves Port
By Yiannis Kourtoglou (Reuters) – Ships carrying 332 tons of food for Gaza left Cyprus’s Larnaca port on Saturday in a convoy which will reach the besieged enclave early next week, authorities said. It...
Shares fell 5.5% to $3.24 in recent premarket trading. The stock has risen 28% in the past year.
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 unit. It also reduced its operating fleet.
Last year, Frontline and Ship Finance International Ltd. (SFL) amended their long-term chartering agreement. And in August and October of this year, Frontline agreed to terminate the long-term charter parties with Ship Finance for the ore-bulk-oil carriers Front Climber and Front Driver, respectively.
On Thursday, Frontline said it will make a compensation payment to Ship Finance of about $500,000 for the early termination of the charter. The transaction will reduce its obligations under capital leases by about $1.1 million, and Frontline expects to record a loss of about $100,000.
The company said it continues to remain cautious as the tanker market has shown a strong negative development in the past four years and a recent rate spike could be short-lived. However it expects operating results for the current quarter to show “some improvement” as compared with the third quarter.
For the quarter, Frontline reported a loss of $49 million, or 63 cents a share, compared with a loss of $166.2 million, or $2.13 a share, a year earlier. The latest quarter included a gain on sale of assets and amortization of deferred gains of $3.3 million, versus a gain of $3.8 million a year ago. It also included a foreign currency translation gain of $49,000 versus a loss of $108,000 a year ago.
Total operating revenue slid 27% to $126.8 million, while revenue excluding voyage expenses and commission dropped 38% to $62.8 million.
Analysts surveyed by Thomson Reuters had expected a loss of 49 cents on revenue excluding voyage expenses and commission of $69 million.
Operating expenses dropped 50%, as the company recorded no impairment loss on vessels as compared with a $121.4 million loss a year earlier.
Frontline won’t pay a dividend for the third quarter.
– Saabira Chaudhuri, (c) 2012 Dow Jones & Company
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