Sovcomflot exits dry bulk sector with sale of Panamax bulker duo

Russian shipping owner PAO Sovcomflot (SCF Group) has completed its exit from the dry bulk business by selling the last two Panamax dry bulk carriers.

As a part of the ongoing fleet modernization and optimization program, Sovcomflot disposed of some aging vessels.

During the first half of 2021, two MR oil products vessels and two Panamax oil product tankers (partly owned through equity-accounted JVs) have been sold.

In addition, two Aframax tankers, two Suezmax tankers and two Panamax dry bulk carriers were sold after the reporting date.

After selling the units, the company has raised $112 million which will be used to finance new projects.

The announcement was published in Sovcomflot’s financial results for the second quarter of 2021.

As informed, due to the unfavorable market conditions, the H1 2021 earnings before interest, taxes, depreciation, and amortization (EBITDA) declined by 42.2% year-on-year to $337.2 million. 

Q2 2021 EBITDA was $181.2 million (16.2% increase on Q1 2021). EBITDA margin improved by 6.9% to 63.6%. 

Q2 2021 net income reached $36.1 million (55.8% increase compared with Q1 2021). H1 2021 adjusted net income was $59.2 million. 

As of 30 June 2021, SCF operated a fleet of 43 vessels with one vessel, the LNG carrier SCF Timmerman, added to the fleet in January 2021.

SCF Group continues to focus on the development of its liquefied gas transportation services.

In addition to a contract for a newbuilding 174,000-cbm Atlanticmax LNG carrier concluded with TotalEnergies, in July 2021 Sovcomflot received confirmation from TotalEnergies to exercise the option for two more similar LNG carriers.

The vessels will be chartered for a period of up to seven years and the company expects that they will add $360 million to Sovcomflot’s contract backlog. Delivery of the vessels is scheduled for Q3 2023 and H2 2024.