Fri, Jun 07, 2013 - Page 14 News List

Sluggish times cause drop in Wisdom Marine profits

By Amy Su  /  Staff reporter

The profits of Wisdom Marine Group (慧洋海運集團), one of the nation’s major bulk shippers, fell by almost 21 percent in the first five months of the year, an indication that the industry remains sluggish.

“The bulk shipping sector’s market conditions have remained weak so far this year,” the company said in a statement on Wednesday.

Wisdom Marine posted a pre-tax profit of NT$813.54 million (US$27.47 million) in the first five months, down 20.72 percent from a year earlier, it said on Wednesday.

Pre-tax earnings per share (EPS) were NT$2.06 in the first five months, down 28.22 percent from NT$2.87 per share recorded a year earlier, as convertible bonds issued by the company were gradually transferred into common stock, increasing the firm’s issued capital, the company’s data showed.

Consolidated revenue totaled NT$3.35 billion, down 2.53 percent from a year ago, the data showed.

Sluggish demand for iron sand — the major commodity carried by bulk ships — pushed down spot prices for the sector, the company said.

The company’s current fleet totals 88 ships, but it will add six new ships by the end of this year.

The company’s strategy is to sign long-term contracts with major clients, but it said it has found it difficult to maintain rental rates when renewing leasing contracts given the vague market outlook.

Capital Securities Corp (群益證券) said in a report that Wisdom Marine sales are expected to continue increasing by a single-digit percentage this year, but the higher costs of new ships and larger-than-expected decline in rental rates may drag down the firm’s gross margin and profit this year.

The brokerage forecast that Wisdom Marine could post NT$1.83 billion in net profit this year, compared with NT$2.1 billion last year.

Meanwhile, CSBC Corp, Taiwan (CSBC, 台灣國際造船), the nation’s biggest shipbuilder, yesterday reported its consolidated revenue declined 25.94 percent to NT$2.24 billion last month from a year earlier.

In the first five months, consolidated sales totaled NT$10.33 billion, down 23.68 percent from the previous year, a stock exchange filing showed.

CSBC attributed the decrease to a fewer number of ships under construction compared with the same period last year.

This story has been viewed 1485 times.
TOP top