Stolt-Nielsen Limited (SNL) has reported its net profit fall to $9.5m in the second quarter, with revenue of $541m, compared with a net profit of $15.6m in the second quarter of 2017. Net profit for the first six months was $48.3m, with revenue of $1,056.3m, compared with $30.8m, with revenue of $976.5m in the first half of 2017.
The company’s second-quarter results included an $11.8m impairment taken on two bitumen ships, reflecting the weak market conditions. First-quarter results benefited from tax-related one-time gains of $24.9m from the lowering of the U.S. federal corporate income tax rate, and $8.2m from a Stolthaven joint venture.
Stolt Tankers reported an operating profit of $26.5m, which included a $9.2m gain on bunker hedges, compared with first-quarter results of $10.9m, which included a bunker hedge loss of $0.3m.
Commenting on the Company’s results, Niels Stolt-Nielsen, Chief Executive Officer of Stolt-Nielsen Limited, said: “SNL’s underlying operating results in the second quarter remained largely in line with our expectations. At Stolt Tankers, we have thus far successfully compensated for rising bunker prices through the bunker hedge programme, but rising bunker fuel costs continue to eat into tanker earnings, as spot rates have not yet fully responded to the increased cost of bunkers.
Stolthaven Terminals reported an operating profit of $20.2m, down from $25.9m. As noted above, the prior quarter reflected the impact of an $8.2m gain from a reduction in deferred tax liabilities in a joint venture. Excluding one-time items, operating income was flat.
Stolt Tank Containers reported an operating profit of $18.8m, up from $16.2m, as shipments grew by 7.6%.
“At Stolthaven, excluding one-offs, operating results were flat,” said Niels. ‘Stolt Tank Containers reported another strong quarter with solid underlying demand driving an increase in shipments. Stolt Sea Farm’s performance continued to benefit from rising turbot prices, although caviar volumes remained below our expectations.
“Our outlook remains fundamentally unchanged. The chemical tanker market appears to have bottomed out, but rising bunker prices will continue to have a negative impact on earnings until spot freight rates begin to reflect the higher cost base.
“At Stolthaven Terminals, gradual improvements in performance are expected to continue, driven by higher utilisation and operational enhancements. At Stolt Tank Containers, the outlook remains positive as global tank container demand continues to grow, the seasonal summer slowdown notwithstanding. For Stolt Sea Farm, continued overall improvement is anticipated, driven by both firming turbot prices and efforts to expand the markets for our products.”
For more information, visit: www.stolt-nielsen.com
5th July 2018