Dear shareholders,
My last shareholder letter was dated August 28, 2016, our
successful capital raise of USD 120 m was completed on September
30, and our 3Q report was dated November 10, 2016.
During 3Q2016 we generated a cash surplus that was much higher
than our cash break even rate, which is below USD 11,000 per day
per ship.
We also expect that the 4Q2016 result will be well above 3Q2016,
which had a time charter of USD 16,700 per day per ship on average
for our vessels on contracts and on short term employment.
Now that we have about 75 % of the available days in 4Q2016
under our belt, we are at about USD 20,000 per day. Our recent
stock issue allowed us to contract for three newbuildings to be
delivered in 2018, increasing the fleet from 30 to 33
Suezmaxes.
The board, management and our advisors subscribed for a total of
$5.3 million of the issue. We eat our own cooking, so to speak, and
our goal is the same as it is for all shareholders: to make money
on our investment. Growth has been a key success factor of
our business model. It’s important for companies to grow and it’s
crucial for our future dividend capacity.
Any company must grow - that is a part of capitalism. A company
that does not grow is dead. Our recent order for 3 new Suezmax
ships at Samsung was concluded at highly attractive terms. A major
part of the purchase price is due on delivery. This is a great
investment, boosting NAT.
Over the years from 2004 we have grown step by step from 3
to 33 Suezmax ships. We have already increased our fleet by 5 ships
this year and will take delivery of our 30th ship
in early 2017.
Except for the three newbuildings, all these vessels were funded
by existing resources. Our objective is to increase earnings.
The acquisitions have to be accretive and increase our earnings
power. The markets for dry cargo vessels and container vessels are
difficult. NAT, of course, is not involved in these sectors.
There is also now limited access to financing, which prevents some
other companies from expanding their fleets. Having access to
financing, as we do, is increasingly becoming a competitive
advantage.
We welcome all investors to become our shareholders. We are the
crude tanker company with the most shareholders in the world.
Whether you are a mutual fund, hedge fund, investment advisor or an
individual investor, we value you all the same. Our large base of
shareholders has made our stock very easy to trade. We can never
have too many shareholders and our stock can never be liquid
enough.
The Suezmax tanker market has recovered significantly from the
time of my last letter, as demonstrated by 4Q2016 results so
far.
The low oil price is good for the tanker market and hence for
NAT. The demand for oil and its production is growing, which
is positive for the transportation of oil. The demand in the Far
East is particularly strong, which makes it a promising market
for us.
Finally, we do not expect that results of the US Presidential
election will affect NAT adversely. Our strategy is to expand with
a low level of debt. When we generate cash we prefer to pay it out
in dividends. We always stick to our strategy and are not
afraid to sail in the opposite direction of the rest of the
industry.
We wish to have the strongest balance sheet and the lowest cash
break even. I firmly believe that this will give the highest total
return to shareholders; the best measure of profitability.
My best wishes to you for a happy new year!
Kind regards Herbjørn Hansson
Chairman & CEO
Nordic American Tankers Ltd
CAUTIONARY STATEMENT REGARDING
FORWARD-LOOKING STATEMENTS
Matters discussed in this press release may
constitute forward-looking statements. The Private Securities
Litigation Reform Act of 1995 provides safe harbor protections for
forward-looking statements in order to encourage companies to
provide prospective information about their business.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements, which are other than
statements of historical facts.
The Company desires to take advantage of the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995 and is including this cautionary statement in
connection with this safe harbor legislation. The words "believe,"
"anticipate," "intend," "estimate," "forecast," "project," "plan,"
"potential," "will," "may," "should," "expect," "pending" and
similar expressions identify forward-looking statements.
The forward-looking statements in this press
release are based upon various assumptions, many of which are
based, in turn, upon further assumptions, including without
limitation, our management's examination of historical operating
trends, data contained in our records and other data available from
third parties. Although we believe that these assumptions
were reasonable when made, because these assumptions are inherently
subject to significant uncertainties and contingencies which are
difficult or impossible to predict and are beyond our control, we
cannot assure you that we will achieve or accomplish these
expectations, beliefs or projections. We undertake no
obligation to update any forward-looking statement, whether as a
result of new information, future events or otherwise.
Important factors that, in our view, could cause
actual results to differ materially from those discussed in the
forward-looking statements include the strength of world economies
and currencies, general market conditions, including fluctuations
in charter rates and vessel values, changes in demand in the tanker
market, as a result of changes in OPEC's petroleum production
levels and world wide oil consumption and storage, changes in our
operating expenses, including bunker prices, drydocking and
insurance costs, the market for our vessels, availability of
financing and refinancing, changes in governmental rules and
regulations or actions taken by regulatory authorities, potential
liability from pending or future litigation, general domestic and
international political conditions, potential disruption of
shipping routes due to accidents or political events, vessels
breakdowns and instances of off-hires and other important factors
described from time to time in the reports filed by the Company
with the Securities and Exchange Commission, including the
prospectus and related prospectus supplement, our Annual Report on
Form 20-F, and our reports on Form 6-K.
Contacts:
Herbjørn Hansson, Chairman & CEO Nordic American Tankers
Limited Tel: +1 866 805 9504 or +47 90 14 62 91
Gary J. Wolfe Seward & Kissel LLP, New York, USA Tel: +1 212
574 1223
Turid M. Sørensen, CFO & EVP Nordic American Tankers Limited
Tel: +47 33 42 73 00 or +47 90 57 29 27
Web-site: www.nat.bm
Press release PDF:
http://hugin.info/201/R/2060534/772519.pdf
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