A continued downward pressure on the LPG market took a toll on Solvang's results in the third quarter.
The Norwegian VLGC owner reported net earnings of NOK 7.1m ($0.9m), compared to NOK 55.4m a year ago.
Solvang explained the smaller figure included an impairment charge of NOK 25.7m due to the write-down of its fleet value.
Revenue for the quarter came to NOK 98.7m, versus NOK 116m.
Solvang added that expired contracts were renewed at lower rates while the Baltic index-related rates were down from $3.05m to less than $0.3m a month.
“The utilization of the global VLGC fleet remain high and export volumes continue to increase quarter-on-quarter, but with the extensive newbuild deliveries, as well as product pricing levels that yield no room for arbitrage between regions, the freight volume is not enough to drive the rates much higher than opex levels,” the company said in its report.
On a more positive note, Solvang said it had high contract coverage of 75% for 2017.
