Gulf Nav back in black

Gulf Navigation Holding has reported a second quarter net profit of AED 3.1m ($844,000) in figures released on Sunday.

The results mark a significant turnaround from the loss of AED 10m seen a year ago by the Dubai-based tanker owner.

The improved result came despite operating revenues declining nearly 23% to AED 30.4m. However, costs fell 36% to AED 21.6m.

The good second quarter helped lift Gulf Navigation’s first half profit to AED 3.6m compared to the loss of AED 29.7m seen in 2013.

Earlier this month Gulf Navigation announced that it had cut its capital by two-thirds and written off accumulated losses worth AED 1.1bn as key parts of a turnaround plan designed to resolve its debt problems.

Its capital was reduced to AED 551m from AED 1.66bn, with the reverse stock split effectively creating one share for every three existing shares.

It has been in talks with creditors for months after an ambitious expansion plan crippled the company, as oversupply hit the tanker sector.

In January shareholders approved the reverse stock split, the issuing of a $130m convertible bond and the sale of two VLCCs to DHT Holdings.

The convertible bond will be part of the firm’s attempts to raise fresh capital and rebuild its business with a focus on chemical or products tankers.