Globus Maritime Limited (NASDAQ:GLBS) reported first-quarter financial results Tuesday that pointed to a strengthening balance sheet as it narrowed its loss for the quarter, compared to the year-ago period.
Globus Maritime owns and operates a fleet of dry bulk vessels that transport iron ore, coal, grain, steel products, cement, alumina and other cargo internationally.
The firm reported its loss for the first quarter of 2019 narrowed to $0.5 million, or $0.15 per share, as compared to a loss of $1.5 million, or $0.48 per share, for the same period last year. Revenue decreased to $3.5 million for the quarter ended March 31, 2019, from $3.9 million in the year-ago quarter.
“We are pleased with our performance during the first quarter of 2019 despite the difficulties in the market this period we have managed to reduce our operating expenses while taking steps to strengthen our balance sheet," said CEO and CFO Athanasios Feidakis in a statement.
"This has been a very precarious first quarter where rates in the dry bulk sector have taken an unexpected dive. We do see several factors that might have contributed to that, such as lower seasonal demand, weather disruptions in Australia and the Vale dam failure. Undoubtedly, weak rates have had a negative impact on the hiring of our vessels that were operating on the spot market during the quarter. However, the market is now at much better levels than what it was in the first two months of the year," said Feidakis.
Operating expenses decrease in 1Q
The firm said that in 1Q, the average operating expenses per vessel per day decreased by about 19% compared to the same quarter a year ago.
Vessel operating expenses, including crew costs, provisions, deck and engine stores, lubricating oils, insurance, maintenance and repairs, saw a noticable decrease by $0.5 million, or 19%, to $2.1 million during the first quarter ended March 31, 2019 compared to $2.6 million for the same period in 2018.
“We will continue to strive to keep our operational costs down and maximize shareholder value, we feel fortunate that at these difficult times we have the full support of our investors and financial institutions," said Feidakis.
Eyes on China
The firm pointed to demand from China as a reason for optimism in the latter part of 2019, thanks to demand for dry bulk goods and International Maritime Organisation (IMO) 2020 regulations, which will see marine sector emissions in international waters cut.
“Whilst we remain cautious, we are at the same time more optimistic about the latter part of the year where we expect rates to improve mainly due to continuous demand from China for dry bulk goods and the IMO 2020 regulations which we believe will have a positive impact on spot charter rates as the effective capacity of the fleet will be reduced since their owners in their efforts to comply with said regulations will try to burn more expensive compliant fuels more efficiently," noted the firm in a statement.
Shares of Globus were at US$2.73 in after-hours trading.
Contact Katie Lewis at [email protected]