Croatian shipping company Tankerska Next Generation published their Q1 2020 results, showing a 5% YoY top line decrease. Meanwhile EBITDA increased by 60% YoY, while net profit soared to HRK 16.9m (+607% YoY).

TNG published their Q1 2020 results yesterday, showing a 5.3% YoY decrease in sales. Lower sales came as a result of lower exposure to the spot market, where the ship-owner achieves nominally higher revenue, but at the same time has increased voyage-related costs.

The average daily TCE of the fleet during the first quarter was recorded at USD 16,565, representing a 20.3% YoY increase. Meanwhile fleet utilization amounted to 99.8%.

EBITDA amounted to HRK 36.6m, representing a 60.1% YoY increase as TNG’s commissions and voyage associated costs amounted to HRK 7.8m, 68.4% lower than in Q1 2019. The decrease was due to the fleet’s less exposure to the spot market.

Below the operating line, TNG’s net financial loss amounted to HRK -6.3m, representing a 19.2% YoY improvement. Finally, net profit amounted to HRK 16.9m, representing an increase of 607% YoY.

Turning our attention to the balance sheet, TNG was able to decrease their net debt by 8.9% since the beginning of the year with net debt amounting to HRK 551.5m. This translates to 4.1x net debt/EBITDA. According to the Management, the decrease in debt is in accordance with the loan repayment plans of TNG and regular decrease in indebtedness, while a further decrease in the company’s debt is expected in the future.

The management provided a calculation of NAV per share, putting it at USD 10.54 (cca HRK 73.5). This would indicate that TNG is currently traded 25.1% below the NAV of their vessels. However, they highlighted that the assessment was based on current market conditions (revenue and cost assumptions of typical average product tanker) which show strong fluctuations and do not take into account TNG specifics and management expectations.

TNG’s Key Financials