Quintana enjoys $7.64 mln profit as ship rates soar

Quintana Maritime Ltd, a Greek shipper of commodities such as coal and grain, said third-quarter profit was $7.64 million because of higher rates and an increased return from a larger fleet. Per-share earnings rose to 13 cents, from a loss of $7.59 million, or 19 cents a share, in the year-ago period, the Athens-based company stated. The average estimate of 11 analysts compiled by Bloomberg was 36 cents. Sales more than doubled to $64 million. Quintana reported a loss of $14.5 million from an interest-rate swap. Not including the loss, operating profit was $22.1 million, or 39 cents a share. The company has been expanding its fleet size, operating 29 vessels with a capacity of 2.6 million deadweight tons. It is awaiting the delivery of eight more ships over the next two years, which would increase its fleet tonnage by 55 percent. Quintana «has one of the better strategies to deal with excessive volatility in the market because they have significant time-charter coverage,» Jonathan Chappell, a JPMorgan Chase & Co analyst, said before release of the report. «They shouldn’t benefit as much to the upside, because they locked in ships.» He rates the shares a «neutral,» the bank’s middle stock rating, because Quintana won’t benefit as much as other companies from rising spot rates. Financing fees The year-ago quarter’s loss included a charge of $11.9 million related to an interest-rate swap contract as well as a $1.8 million write-off of financing fees. Without those, Quintana said profit would have been $6.1 million, or 16 cents a share. Quintana stock fell $1.42, or 5.2 percent, to $25.78 in New York Stock Exchange composite trading today, valuing the company at $1.45 billion. The shares have more than doubled so far this year. The Baltic Dry Index, a measure of commodity-shipping costs on different routes and ship sizes, reached a record on October 29, according to the London-based Baltic Exchange. «We’re very optimistic and bullish on dry bulk,» Chappell said. Record purchases of commodities by China, the world’s fastest-growing major economy, have congested ports and caused freight rates to more than double in the past year. China’s economy expanded more than 11 percent for a third quarter, the government said last week. Last month, Quintana said it hired financial advisers, suggesting it may put itself up for sale. The Glyfada, Greece, -based shipper said it retained Citigroup Inc and Dahlman Rose & Co as advisers. Quintana operated an average of 29 vessels at $25,517 per day, from 13.4 vessels with average daily earning of $21,439 a ship in the year-ago period. Quintana said its fleet is fully booked for the remainder of this year and 90 percent booked for 2008, 80 percent booked for 2009 and 71 percent booked for 2010. The company said on the basis of the current bookings, it expects net sales of about $238 million in 2008, $202 million in 2009 and about $195 million in 2010. (Bloomberg)