Buoyed by rising freight rates, bulk shipper Wisdom Marine Lines Co (慧洋海運) on Friday reported a record net profit of NT$8.24 billion (US$294.07 million) for last year, up 7,300 percent from NT$111.41 million a year earlier.
Consolidated revenue rose 60.56 percent year-on-year to NT$19.17 billion, it said in a statement.
The figures were slightly better than the NT$8.19 billion in net profit and NT$19.16 billion in revenue estimated by Fubon Securities Investment Services Co (富邦投顧).
Photo: Bloomberg
Earnings per share were NT$11.05, compared with NT$0.15 in 2020 and Fubon’s estimate of NT$10.98.
As operating costs rose only 4 percent to NT$10.72 billion, gross margin improved to 44.09 percent last year, from 13.88 percent a year earlier.
Wisdom attributed the improvement in profitability to rising freight rates and higher cargo demand due to congestion at seaports worldwide.
The average daily freight rate for handysize vessels — a small to middle-sized bulk carrier with a deadweight of 24,000 to 40,000 tonnes — once peaked at US$37,000 last year, benefiting Wisdom, which has more than 40 handysize ships among its fleet of 137 vessels, it said.
The Baltic Dry Index, which tracks the freight rates of all types of ships, mildly rebounded last month. It closed at 2,076 points yesterday, up from 1,381 points at the end of January, but still lower than a peak of 5,500 points in October last year.
Wisdom remains upbeat about freight rates this year and expects shipping demand to outweigh supply, it said.
“The number of newly built vessels has been at a comparatively low level over the past five years, so the overall cargo capacity would not increase quickly in the near term,” its statement said. “However, demand for cargo would remain strong, as China would resume imports after the Winter Olympics and South America is to enter its grain harvest season.”
Wisdom reiterated that it would boost freight rates by 25 percent when it renews contracts for 60 vessels this year, it said.
The company last year took delivery of seven new vessels and disposed of 10 vessels. It expects to receive six vessels this year.
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