Greek Shipping Restructures To Deal With Crisis, Debt

Greece’s financial crisis has taken its toll on one of the country’s strongest sectors, shipping, with five of the country’s largest companies selling off a total of 16 vessels and seeing their fleet reduced from 81 ships in 2008 to 65 at the end of 2013, a recent study by XRTC Business Consultants found.

Shipping companies ANEK, Attica, Minoan Lines, NEL – listed – and Hellenic Seaways are expected to continue with sales of their fleet this year in efforts to reduce their debt and become competitive.

The market is abuzz with talk about the sale of Attica Group’s passenger ship Blue Star Ithaki as well as of its subsidiary Blue Star Ferries to the Canadian government. Discussions began last April, but the deal has not been completed. Attica Group has not confirmed the sale, according to financial daily Naftemporiki.

The Blue Star Ithaki was built in Korea in 2000 and was the first in a series of newly launched passenger ships to sail the Aegean. A shipping insider told Naftemporiki that the case of the Blue Star Ithaki only goes to show that investment in coastal shipping is not a one-off deal, but must be ongoing in order to ensure high quality standards.

At the same time, Attica Group has added two new vessels to its fleet in the last three years, the Blue Star Delos (2011) and Blue Star Patmos (2012). In 2013, however, it sold Superfast VI for 54 million euros.

ANEK recently announced the sale of two ships and at the same time secured long-term charter contracts for the vessels. The total sale amounted to 21 million euros, which will be used to reduce the company’s long-term debt.

In the meantime, the drop in fuel prices is good news for shipping. The price of marine fuel IFO 380, used mostly by conventional vessels, has dropped recently to 425 euros/ton compared to 515 euros/ton in the corresponding period in 2013, a 17.5% drop.

The overall gain due to dwindling oil prices is expected to add some 10 million euros to a shipping company’s annual coffers, especially if they operate vessels in the Adriatic.