Gulf Navigation Holding has reported losses of AED 14.7-million for the second quarter of 2018, compared to profits of AED 19-million during the same period last year, largely as a result of wide scale fleet investment.
“Although our financial records show losses in this quarter, it is a necessary step for achieving future gains and will open the door for major achievements in the coming years,” said Khamis Juma Buamim, board member, managing director and group CEO of Gulf Navigation Holding.
“One of the most important achievements was to end the legal dispute with one of the Chinese companies that dates back to 2014. We managed to reach a settlement to reduce the claim to $8 million,” he added.
Gulf Navigation Holding also put two petrochemical tankers into the dry dock for their mandatory five-year maintenance, which included major upgrades to the two carriers in order to enhance the company's competitiveness in the global markets.
This is done by adopting plans and programs to fully comply with international environmental laws related to reducing greenhouse gas emissions, climate change and the targets for 2020, 2025 and 2030.
The upgrade will equip the two vessels with state-of-the-art technologies that will reduce operational expenses.
“This is another important investment expense, for which we have allocated a substantial amount of the company’s revenues in this quarter,” says Buamim.
“We have installed gas exhaust pumps to reduce sulphur emissions and added advanced equipment to treat ballast water to prevent biological pollution,” he added. “This will help our vessels comply with IMO's standards and give us an advantage to get new contracts in established markets such as the European Union and North America.”
Gulf Navigation’s technical team of experts adopted these major upgrades and changes for the company’s fleet after an in-depth study of the global petrochemicals and petroleum products shipping industry.
New requirements and standards imposed by the International Maritime Organization (IMO), the European Union, and the United States will force many companies to exit these markets because of their inability to keep up with them.
It is also expected that low-sulphur fuels will be more expensive and less available.