Increasing shipping volumes and an improvement in tanker rates helped Gulf Navigation post a 69 per cent rise in profit for the third quarter of the year, even as questions remain over its debt obligations.
The Dubai-listed shipping firm reported a net profit of Dh5.6 million for the three months to the end of September, compared with Dh3.3m in the same period last year. Revenues for the quarter rose 4.6 per cent to Dh34.5m.
“Our higher revenue in the past nine months was also the result of several key factors, most notably the healthy increase in volume of our shipping services and marine product sales and distribution business, improvement in tanker spot rates, and reduction in off-hires,” said the company’s founder, Hazza Baker Al Qahtani.
“We are confident that we will continue this upward trajectory, with the company ending stronger by the end of this year.”
Such optimism masks questions about the company’s ability to keep afloat, as it remains in breach of a number of loans.
While the company’s liabilities fell to Dh628,137 at the end of September from Dh648,818 at the end of June, the outstanding loans “indicate the existence of a material uncertainty that may cast significant doubt about the ability of the group to continue as a going concern”, according to the auditor PricewaterhouseCoopers.
A DIFC Courts judge in July rejected an attempt by Norway’s DNB to have a US$8.7m judgment against the shipping group referred to the Dubai Courts for enforcement against UAE-based assets. DNB has been given leave to appeal the decision.
Gulf Navigation shares fell 4 per cent to 50 fils each on Sunday as part of a wider sell-off of equities on the Dubai Financial Market.
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