Eitzen Chemical has reported a $24.9m loss for the second quarter as it struggles under its debt commitments, in line with a $25.9m loss in the first quarter and $24.4m loss in the second quarter 2013.
As it stated its continuing discussions with creditors to restructure its commitments and improve its balance sheet, the company described itself as "significantly over-leveraged with a negative book equity of $157.5m."
The Eitzen Chemical fleet returned average time charter equivalent earnings of $10,284 per day in the second quarter, a 13.7% decrease on the $11,921 reported in the same period last year.
EBITDA dropped from $15.3m in Q2 2013 to $4.8m in the second quarter 2014. Weighing down the company's revenues, the quarter's interest and depreciation remained broadly similar. Interest expense was up from $14.7m to $15.4m while depreciation fell from $14.3m to $14.1m.
The company's operating result was a $9.3m loss, improving on the $13.7m loss recorded in Q2 2013, although the 2013 result did include a $14.7m loss associated with the termination of one time charter and renegotiation of another two.
For the half, EBITDA was down by 54% compared to the second half of 2013, from $25.8m to $11.8m in 2014. The result brings Eitzen's first half loss to $50.7m compared to a $35m first half loss last year.
During the second quarter, a $2.4m gain was earned on the sale and leaseback of the 19,932 dwt North Fighter, a gain that has been deferred and amortised over the two year term of the ship's lease.
In its assessment of the market conditions, Eitzen saw a weak clean products market, down from World Scale 120 to Word Scale 90, placing pressure across other markets. Good activity on transpacific eastbound routes from the Far East to the US Gulf in both benzine and methanol was balanced by low activity on the westbound route, with spot vessels "piling up" in the US gulf.
For the westbound transatlantic chemical market the market was so low that some owners opted to position to the US Gulf under ballast for the CoA commitments.
Eitzen sees a moderate orderbook of around 15% of the fleet and an expected long term demand growth of 4-5% for the chemical tanker market under 54,000 dwt as signs of a gradual improvement for the market in the coming years.