Gulf Navigation expects to get some leeway by refinancing some of its recent vessel deals. (Image used for illustrative purposes.) Image Credit: Supplied

Dubai: The Dubai commercial vessels operator Gulf Navigation is trying to refinance some of its fleet purchases at a lower rate – one of the way it hopes to restructure operations and bring down accumulated losses of Dh724.14 million.

Another possible way is to divest “non-profitable business segments”, though the company has not detailed which units figure in this. It was recently that Gulf Navigation put together a three-year business plan and brought in a new management, including a group CFO.

The main reason for the accumulated losses are “impairment of assets and goodwill in 2019” and the write-off from losing a vessel off the Japan coast last year. Plus, the “COVID-19 impact resulted in higher operating expenditure in 2020, mainly for crew coupled with lower activities”.

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The company is now trying to recover from the insurer claims related to the lost vessel, which it hopes will be done this quarter. “The company will receive an insurance claim of $22.5 million and plans to refinance debts and sale and lease back (SLB) facilities,” according to a statement. “This plan will stabilize the group’s cash position and allow to invest the excess cash in capital expenditure to cover the dry dock cost of one tanker and use excess cash to unwind accounts payable.”

If all goes according to plan, Gulf Navigation forecasts 2021 revenues of $37.77 million and which would grow to $46.37 million in 2023.