Company Announcement 3/2021

March 23, 2021 9:33 AM EDT

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March 23, 2021

NORDIC SHIPHOLDING A/S
Company Announcement: 3/2021


Published via NASDAQ OMX on March 23, 2021



Nordic Shipholding A/S – Update on 2020


Negative equity due to further write down on vessels

2020 started on a very positive note, where the Group enjoyed high Time Charter Equivalent (“TCE”) rates arising from the short-term surge in demand for tonnage caused by the COVID-19 pandemic and the oil price war which started in Q1 2020.  However, TCE rates started spiralling downwards from May 2020, and continued to slide through the end of the year.  Despite the sharp correction in the TCE rates in H2 2020, the average daily TCE rates earned in 2020 by the 5 vessels was approximately 21% higher than the average TCE rate earned in 2019.

Including the impairment losses of USD 6.1 million arising from the reclassification of Nordic Hanne and Nordic Pia to assets held-for-sale, and impairment losses of USD 14.9 million on the remaining vessels to fair market value, the Group incurred a loss after tax of USD 16.5 million in 2020 compared to a loss after tax of USD 3.9 million in 2019.

Apart from the additional impairment loss on the vessels, the actual results for 2020 was in line with the revised expectations of the Board, as indicated in the Company Announcement 11/2020 on 11 December 2020.

Given the healthy cash flows arising from the relatively strong product tanker market for most of 2020, the Group managed to pay down the loan liabilities by USD 14.8 million from a combination of cash sweep and loan amortization. However, despite the generally good operating performance, the Group’s equity was completely erased and entered into negative territory primarily due to the writing down of the carrying value of the rest of the fleet. Regardless of the Group’s negative equity, the Board remains optimistic that a merger may be consummated as active discussion with potential merger partners are progressing well.

In the event the merger discussion fails, it is management’s expectation that the lenders will finance the Company in a period longer than 31 December 2021 to secure an orderly sale of the vessels.

The Annual report 2020 is expected to be published on 24 March 2021.

For further information please contact:
Knud Pontoppidan, Chairman of the board, Nordic Shipholding A/S: +45 39 29 10 00




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