Ship glut hurts oil tanker earnings

Updated 08 January 2013
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Ship glut hurts oil tanker earnings

Crude oil tanker earnings on the major Middle East route were steady yesterday although a surplus of vessel availability was capping rates.
The world's benchmark VLCC export TD3 route from the Middle East Gulf to Japan reached W43.20 in the worldscale measure of freight rates, or $ 15,592 a day when translated into average earnings.
That compared with W43.08 or $16,023 a day on Friday and W42.83 or $ 16,136 a day last Thursday. The Baltic did not publish comparable data last Monday due to the holiday season.
According to Reuters, Brokers said firmer bookings in recent days were being offset with a glut of tankers.
“VLs are currently trading at $ 16,000/day on TD3 and we do not see any short-term moves higher,” Arctic Securities analyst Erik Nikolai Stavseth, told Reuters.
Tanker players said downside risks remained for the sector, given risks to the global economy and the fact that more tankers, ordered when times were good, were still to join the global fleet this year.
“The demand side looks less encouraging should oil analysts' prediction of lower demand for OPEC oil materialise. Our base case is therefore for weaker oil trade and somewhat lower rates than last year,” RS Platou Markets said.


NMC Health’s $450 million bond to boost Saudi expansion

Updated 9 min 26 sec ago
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NMC Health’s $450 million bond to boost Saudi expansion

LONDON: The UAE-based private health care operator NMC Health has launched a $450 million senior unsecured guaranteed bond to help pay off an existing $1 billion bridge facility and support its expansion plans into Saudi Arabia.

The earlier bridging loan was part of the $2 billion capital structure refinancing put in place at the start of the year, the company said.

The bond is due in 2025 and is convertible into ordinary shares. JP Morgan is the sole bookrunner on the issuance. Bonds will have a fixed coupon rate of 1.875 percent, paid semi-annually.

The new capital structure — which will feature a mixture of unsecured bank and bond financing — will aid the company’s continued growth into Saudi Arabia, with NMC having been one of the first private health care providers to capitalize on the Saudi government’s health care privatization plans.

The company first secured a foothold in the Kingdom in 2016 after acquiring a 70 percent stake in As Salama Hospital in Al-Khobar.

Since then, NMC won regulatory approval last September for a new long-term care facility, the Chronic Care Specialty Medical Center, in Jeddah. It is though to be the first greenfield medical facility in the Kingdom to be set up by a non-Saudi company.

Earlier this year, NMC said it acquired an 80 percent stake in the Riyadh-based Al-Salam Medical Group.

NMC’s acquisition-led expansion strategy aims to ensure the company retains its recently-won place on London’s FTSE 100 index. It was one of the first Middle Eastern companies to join the index when it qualified last September. It first listed on the London Stock Exchange in 2012.

The company posted strong growth in the last year, reporting $209.3 million in net profit for 2017, an increase of 38.2 percent on the previous year. The company paid out a total of $641 million in acquisitions last year.

“2017 proved to be a year of tremendous achievements for NMC,” said the firm’s chief executive Prasanth Manghat, in a statement in March.

NMC also secured secured its first public ratings of BB+ with a stable outlook from S&P on April 20, while Moody’s gave the firm rating of Ba1 with a stable outlook on April 20, 2018. The bonds are not expected to be rated.

“The company continues to strive to meet self-imposed standards that are higher when compared to what is expected of it by various regulators. This approach supports in turn its resilient business model, loyal customer base, strong brand recognition and market leading position,” according to a statement from Moody’s Investors Service.

Investors are so far reacting favorably to NMC’s strategy, with the company closing at a record high on April 20, according to Bloomberg reports, with a market value of $10.8 billion.

The company is now one of 24 equities in the region to have achieved a market capitalization of more than $10 billion, the report said.

Healthcare is seen as a lucrative sector in the Gulf due to its relatively wealthy population becoming increasingly at risk of problems related to obesity and diseases such as type 2 diabetes.