Gener8 Maritime, Inc. (GNRT) has reported 87.25 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $5.80 million, or $0.07 a share in the quarter, compared with $45.52 million, or $0.55 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $20.08 million, or $0.24 a share compared with $47.71 million or $0.58 a share, a year ago. Revenue during the quarter went down marginally by 1.07 percent to $99.58 million from $100.66 million in the previous year period. Gross margin for the quarter contracted 761 basis points over the previous year period to 69.61 percent. Total expenses were 76.57 percent of quarterly revenues, up from 49.92 percent for the same period last year. That has resulted in a contraction of 2665 basis points in operating margin to 23.43 percent.
Operating income for the quarter was $23.33 million, compared with $50.41 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $64.26 million compared with $64.62 million in the prior year period. At the same time, adjusted EBITDA margin improved 34 basis points in the quarter to 64.54 percent from 64.20 percent in the last year period.
"As we continue to receive vessels from our newbuilding program, it becomes increasingly apparent that a two-tier market exists favoring modern, “ECO" vessels. For the second consecutive quarter, our “ECO” VLCCs earned between 10% and 15% more on an average daily TCE basis than our non-”ECO” VLCCs," said Peter Georgiopoulos, chairman and chief executive officer of Gener8 Maritime. “We continued to increase the modernity of our fleet with the delivery of three “ECO” VLCCs in the fourth quarter and two “ECO” VLCCs to date in the first quarter of 2017 and the sale of two older vessels during the same periods. Following the completion of our newbuilding program expected this year and assuming no further changes to our fleet, the DWT-weighted average age of our fleet will be 4.9 years, and our VLCCs will have an average age of just 2.7 years, giving us the youngest and most modern VLCC fleet among our public company peers. Marine fuel prices have been steadily increasing over the last year, highlighting the fuel efficiency of our “ECO” design vessels, which have quickly become a significant driver of the favorable TCE rates we have been able to achieve in a relatively weak rate environment. We believe this advantage will become more pronounced over time."
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