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Saturday, April 11, 2009

Excel plans 'unaffected' by $329m fourth quarter loss

Nigel Lowry, Athens - Thursday 9 April 2009

FOURTH quarter write-downs and other book losses have dragged Excel Maritime Carriers to a net loss of $44.7m for 2008. 
In results that were delayed to allow it to complete comprehensive restructuring and covenant waiver agreements with its banks, the Athens-based dry bulk fleet owner reported a $329m net loss for the last quarter of the year. 
But adjusted results that would have shown a $75.4m profit surpassed analysts’ expectations. 
Management said that the company’s “balanced fleet deployment strategy and quality charters”, partly stemming from the fleet inherited last year with the takeover of Quintana Maritime, had cushioned it from daily charter market turmoil and allowed it to continue generating strong cash flows. 
“During the fourth quarter of 2008, we experienced a severe deterioration of market fundamentals mainly caused by an almost unprecedented global economic crisis,” said chief financial officer Lefteris Papatrifon. 
He said: “This had a direct effect on our business and profitability but in no means has it affected our long term strategic plans.” 
The recent deal with its banks together with a $45m equity infusion by chairman Villy Panayotides and family was “solid proof” of confidence in the company and its prospects, Mr Papatrifon stated. 
At end-year, the balance sheet showed $109.8m in ash and cash equivalents, while long term debt stood at $1.5bn. 
Excel’s share surged in New York after hours on better than expected figures and a ration of good news contained in the announcement, including the outcome of talks with two charterers that sought to axe time charter levels earlier this year. 
According to Excel, it has substantially mitigated the fall-out from the “unilateral” moves. 
Non-cash charges that wrecked the fourth quarter numbers included a $40m adjustment on the valuation of interest rate swaps and a $335m impairment charge accepted to write-off goodwill from the Quintana acquisition. 
Excel also reported that it lost a total $11m on its investment in spin-off Oceanaut, which is in the throes of liquidation.