Nordic American Tankers Limited (NYSE:NAT) - Letter to the Shareholders - an update with good prospects
(Thomson Reuters ONE) -
Hamilton, Bermuda, December 21, 2016
Today, a few days before Christmas, we wish to give you a brief update on a few
pertinent NAT matters. As previously communicated, the fourth quarter of 2016
is turning out well. Our cash break even below $11,000 per ship per day gives an
excellent basis for solid cash surpluses.
The 4Q2016 cash results are expected to be about $20,000 (time charter
equivalent) per ship per day. The NAT fleet is increasing and our 30(th)
Suezmax tanker is scheduled to be delivered to us mid-February 2017. It has
already obtained employment for her maiden voyage. Three more newbuildings
will increase the fleet with further 10%, impacting dividend and earnings
capacity correspondingly.
We do not have all our ships in the spot market. Some of them are employed on
short term and longer term contracts with solid clients. So far, the first
quarter of 2017 has started off well with a strong tanker market.
In our reports, we have repeatedly stressed that Net Asset Value (NAV) - the
steel value of a ship - is of no relevance in the assessment of the value of NAT
as a going concern.
For further details, please see our below letter of November 30, 2016.
NAT has a good future. We are happy to respond to any questions you may have.
Meanwhile, we wish you all the best for the Holiday Season!
Kind regards,
Herbjørn Hansson
Chairman & CEO
Nordic American Tankers Ltd.
Below is the Letter to Shareholders:
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Nordic American Tankers Limited (NYSE:NAT) - Letter to the Shareholders.
Prospects for the fourth quarter of 2016 look good, an improvement on an already
positive third quarter of 2016. A low oil price is good for the tanker
business.
Hamilton, Bermuda, November 30, 2016
Dear shareholders,
My last shareholder letter was dated August 28, 2016, our successful capital
raise of USD 120 m was completed on September 30, and our 3Q report was dated
November 11, 2016.
During 3Q2016 we generated a cash surplus that was much higher than our cash
break even rate, which is below USD 11,000 per day per ship.
We also expect that the 4Q2016 result will be well above 3Q2016, which had a
time charter of USD 16,700 per day per ship on average for our vessels on
contracts and on short term employment. A low oil price is good for the tanker
business.
Now that we have about 75 % of the available days in 4Q2016 under our belt, we
are at about USD 20,000 per day. Our recent stock issue allowed us to contract
for three newbuildings to be delivered in 2018, increasing the fleet from 30 to
33 Suezmaxes.
The board, management and our advisors subscribed for a total of $5.3 million of
the issue. We eat our own cooking, so to speak, and our goal is the same as it
is for all shareholders: to make money on our investment. Growth has been a key
success factor of our business model. It's important for companies to grow and
it's crucial for our future dividend capacity.
Any company must grow - that is a part of capitalism. A company that does not
grow is dead. Our recent order for 3 new Suezmax ships at Samsung was concluded
at highly attractive terms. A major part of the purchase price is due on
delivery. This is a great investment, boosting NAT.
Over the years from 2004 we have grown step by step from 3 to 33 Suezmax ships.
We have already increased our fleet by 5 ships this year and will take delivery
of our 30th ship in early 2017.
Except for the three newbuildings, all these vessels were funded by existing
resources. Our objective is to increase earnings. The acquisitions have to be
accretive and increase our earnings power.
The markets for dry cargo vessels and container vessels are difficult. NAT, of
course, is not involved in these sectors. There is also now limited access to
financing, which prevents some other companies from expanding their fleets.
Having access to financing, as we do, is increasingly becoming a competitive
advantage.
We welcome all investors to become our shareholders. We are the crude tanker
company with the most shareholders in the world. Whether you are a mutual fund,
hedge fund, investment advisor or an individual investor, we value you all the
same. Our large base of shareholders has made our stock very easy to trade. We
can never have too many shareholders and our stock can never be liquid enough.
The Suezmax tanker market has recovered significantly from the time of my last
letter, as demonstrated by 4Q2016 results so far.
The low oil price is good for the tanker market and hence for NAT. The demand
for oil and its production is growing, which is positive for the transportation
of oil. The demand in the Far East is particularly strong, which makes it a
promising market for us. Finally, we do not expect that results of the US
Presidential election will affect NAT adversely.
Our strategy is to expand with a low level of debt. When we generate cash we
prefer to pay it out in dividends. We always stick to our strategy and are not
afraid to sail in the opposite direction of the rest of the industry.
We wish to have the strongest balance sheet and the lowest cash break even. I
firmly believe that this will give the highest total return to shareholders; the
best measure of profitability.
My best wishes to you for a happy new year!
Kind regards
Herbjørn Hansson
Chairman & CEO
Nordic American Tankers Ltd
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Matters discussed in this press release may constitute forward-looking
statements. The Private Securities Litigation Reform Act of 1995 provides safe
harbor protections for forward-looking statements in order to encourage
companies to provide prospective information about their business. Forward-
looking statements include statements concerning plans, objectives, goals,
strategies, future events or performance, and underlying assumptions and other
statements, which are other than statements of historical facts.
The Company desires to take advantage of the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995 and is including this
cautionary statement in connection with this safe harbor legislation. The words
"believe," "anticipate," "intend," "estimate," "forecast," "project," "plan,"
"potential," "will," "may," "should," "expect," "pending" and similar
expressions identify forward-looking statements.
The forward-looking statements in this press release are based upon various
assumptions, many of which are based, in turn, upon further assumptions,
including without limitation, our management's examination of historical
operating trends, data contained in our records and other data available from
third parties. Although we believe that these assumptions were reasonable when
made, because these assumptions are inherently subject to significant
uncertainties and contingencies which are difficult or impossible to predict and
are beyond our control, we cannot assure you that we will achieve or accomplish
these expectations, beliefs or projections. We undertake no obligation to
update any forward-looking statement, whether as a result of new information,
future events or otherwise.
Important factors that, in our view, could cause actual results to differ
materially from those discussed in the forward-looking statements include the
strength of world economies and currencies, general market conditions, including
fluctuations in charter rates and vessel values, changes in demand in the tanker
market, as a result of changes in OPEC's petroleum production levels and world
wide oil consumption and storage, changes in our operating expenses, including
bunker prices, drydocking and insurance costs, the market for our vessels,
availability of financing and refinancing, changes in governmental rules and
regulations or actions taken by regulatory authorities, potential liability from
pending or future litigation, general domestic and international political
conditions, potential disruption of shipping routes due to accidents or
political events, vessels breakdowns and instances of off-hires and other
important factors described from time to time in the reports filed by the
Company with the Securities and Exchange Commission, including the prospectus
and related prospectus supplement, our Annual Report on Form 20-F, and our
reports on Form 6-K.
Contacts:
Herbjørn Hansson, Chairman & CEO
Nordic American Tankers Limited
Tel: +1 866 805 9504 or +47 90 14 62 91
Gary J. Wolfe
Seward & Kissel LLP, New York, USA
Tel: +1 212 574 1223
Turid M. Sørensen, CFO & EVP
Nordic American Tankers Limited
Tel: +47 33 42 73 00 or +47 90 57 29 27
Web-site: www.nat.bm
Press release PDF:
http://hugin.info/201/R/2067026/776110.pdf
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Nordic American Tankers Limited via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 21.12.2016 - 13:45 Uhr
Sprache: Deutsch
News-ID 514325
Anzahl Zeichen: 10366
contact information:
Town:
Hamilton
Kategorie:
Business News
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