Dubai’s Gulf Navigation Holding is looking to boost its liquidity through an insurance payout that’s still under negotiations for the sinking of its vessel, Gulf Livestock 1.

The listed shipping firm made the statement on Monday as it announced a net loss of 61 million dirhams ($16.6 million) for 2020, down from the loss of 327 million dirhams in 2019.

The company attributed last year’s net loss to lower activities in livestock transportation due to the sinking of its vessel, as well as the sale of a chemical tanker.

Last September, the company’s Gulf Livestock 1 was lost in a typhoon en route from New Zealand to China, with 41 crew members on board. Only two survivors were found. The firm had sought an insurance compensation for the accident.

Boost liquidity

In a statement to the Dubai Financial Market (DFM), the company said the payout for the lost ship will “enhance liquidity” and support operational activities.

It added that negotiations are still ongoing and that the outcome would be disclosed “very soon”.

Auditors had earlier cast doubts on GNH’s ability to continue as a going concern, after the company included the undecided livestock ship insurance claim as a receivable in its third quarter results.

While the company recorded a gross profit of 14.6 million dirhams in 2020 compared with a loss of 5.5 million dirhams in 2019, gross revenue was down from 166.3 million to 145.8 million dirhams.

GNH is flagged as a company with accumulated losses of between 20 and 50 percent of issued capital on DFM.

(Reporting by Imogen Lillywhite; editing by Cleofe Maceda)

Imogen.Lillywhite@refinitiv.com

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