(RTTNews) - Nordic American Tanker Shipping Ltd. (NAT: News ) reported Monday a loss for its third quarter ended September 30, 2009, reflecting mainly demand contraction in the tanker industry as oil exports from OPEC to the West reduced. Citing lower level of spot tanker market, the group declared a sequentially lower third quarter dividend.

The Hamilton, Bermuda-based group posted a quarterly net loss of $11.8 million or $0.28 per share versus net income of $42.68 million or $1.24 per share a year ago. Excluding one-time charges, the loss from ongoing operations was $0.26 per share.

Nordic American Tanker's quarterly net voyage revenue declined to $17.74 million from $67.31 million last year, reflecting lower tanker freight market and higher voyage expenses. Voyage expenses for the period rose to $3.83 million from $1.88 million.

During the latest third quarter, net operating expenses rose to $29.14 million from $24.51 million a year earlier. This resulted in loss from vessel operation of $11.39 million compared with an income from vessel operation of $42.79 million in the prior year.

On November 8, the group announced the addition of a new vessel to its existing fleet, making its fourth acquisition in 2009. The company noted, "From the end of 2008 and until August 2010 - a period of 20 months - the total fleet will have grown from 12 to 18 vessels, thereby increasing the dividend and earnings potential by 50%."

The company said it does not plan to raise capital from the market for its current fleet of vessels. It also had zero net debt and an undrawn revolving credit facility of $500 million.
On a sequential quarterly comparison, the group's board declared a dividend of $0.10 per share, lower than second quarter's $0.50 per share, as a result of weak spot suezmax tanker freight market. The Imarex rates, giving an indication of the level of the tanker market, were on average $13,000 per day during the third-quarter. The group's average daily rate for spot vessels was $14,075 per day.

During the quarter under review, the group had not undertaken any scheduled dry-dockings, and had 25 days of unplanned off-hire and 15 days planned off-hire for its fleet. Though demand for tankers in transportation capacity was lower during recession, tankers for storage picked up to certain extent. On the supply side, the group sees delayed deliveries and cancellation of newbuilding orders, owing to current financial upheaval.

Going forward, the company expects spot suezmax freight rates may fluctuate in an unpredictable manner.

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