When Will Concordia Maritime AB (publ) (STO:CCOR B) Turn A Profit?

With the business potentially at an important milestone, we thought we'd take a closer look at Concordia Maritime AB (publ)'s (STO:CCOR B) future prospects. Concordia Maritime AB (publ) operates as a tanker shipping company in Sweden and internationally. The kr402m market-cap company posted a loss in its most recent financial year of kr103m and a latest trailing-twelve-month loss of kr8.1m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Concordia Maritime will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Concordia Maritime

Concordia Maritime is bordering on breakeven, according to some Swedish Oil and Gas analysts. They expect the company to post a final loss in 2021, before turning a profit of kr65m in 2022. So, the company is predicted to breakeven just over a year from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 53% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Concordia Maritime given that this is a high-level summary, however, keep in mind that by and large energy companies, depending on the stage of operation and resource produced, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

Before we wrap up, there’s one issue worth mentioning. Concordia Maritime currently has a relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in Concordia Maritime's case is 74%. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Concordia Maritime, so if you are interested in understanding the company at a deeper level, take a look at Concordia Maritime's company page on Simply Wall St. We've also compiled a list of important factors you should further examine:

1. Valuation: What is Concordia Maritime worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Concordia Maritime is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Concordia Maritime’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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