Osprey Reports Disappointing First Half

Osprey Maritime Ltd. reported poor interim results, and announced that the second half would be difficult due to pressure on charter rates. The outlook for Osprey, which has a total debt of $813.7 million as of the end of June 1999, also hinged on the outcome of talks with bankers to extend its short term loans of $370.4 million. The loans were originally repayable on July 20, 1999. The debt was incurred following its multi-million acquisition of Gotaas Larsen Shipping Corp. in 1997. For the six months ended in June, the group saw a 73 percent dive in earnings to $840,000 from $3.9 million previously, after taking into consideration the preference share dividends. Turnover also fell 14 percent to $98.43 million from $114.77 million. "If the bank loans are not extended, there will be serious discussions with the banks going forward. There will presumably be forced sales of assets," Chairman Tim Cottew said, adding that it would not be in the best interest of its creditors and the company, which had a total cash balance of $72.5 million as of Sept. 17, 1999 and committed future revenues of $195 million. Osprey is reviewing its strategic focus, which was shipping of liquefied natural gas (LNG), and might have to sell its non-LNG vessels to reduce its debt - a move which could result in a write-down of its assets and exceptional losses. "There will be no impact on cash flow...Going forward, it will be positive for the group. Depreciation charge will be reduced proportionately with positive impact on earnings per share," Cottew said. He expected rates for the rest of the year to stay weak. Osprey's fleet comprises five LNG carriers, 10 crude oil carriers and 15 product vessels.