Norwegian chemical tanker company Odfjell reported a 69% sequential jump in second-quarter net profit to $54 million, driven by higher time charter earnings and improved operational efficiency. Adjusted net profit rose to $56 million, up from $26 million in the prior quarter.
Earnings per share increased 66% to $0.68, while EBIT climbed to $69 million and EBITDA reached $111.3 million, both up from the first quarter. Time charter earnings totaled $195 million, including a $5.3 million customer settlement following a favorable arbitration outcome. Average daily time charter earnings rose to $29,486, compared with $27,232 in Q1.
The company’s cash break-even rate fell to $21,804 per day, while operating cash flow surged to $81 million and free cash flow reached $61 million. Odfjell’s board approved a $0.52 per share dividend based on first-half results, yielding an 8.7% annualized return at the current share price of $114.
Terminals business EBITDA declined to $10.7 million as net results dipped to $1.8 million due to a smaller impairment. Average commercial occupancy increased to 96%, with throughput up 6%. Cargo volumes remained stable at 3.2 million tons, though management noted reduced activity in the Middle East. The carbon intensity metric improved to 6.9 from 7.0 in Q1.
Odfjell expanded its fleet with two new vessels on long-term charters and sold one vessel for recycling. The company also agreed to purchase four super-segregators from Kitanihon Shipbuilding in Japan, with deliveries scheduled between Q1 2027 and Q2 2029. Total time charter and CapEx commitments now stand at $289 million, including a $35.4 million payment for the Bow Pluto in July.
Management expects third-quarter underlying profit to soften toward first-quarter levels as spot markets weaken. Financing for four owned newbuildings is slated for completion by year-end. The company’s P/E ratio stands at 6.3 based on trailing twelve-month earnings, with a free cash flow yield of 26% and equity ratio of 46%.
CEO Harald Fotland highlighted the company’s global presence as a key advantage amid market volatility, while CFO Terje Iversen noted time charter earnings reached $195 million, up from $167 million in Q1.
