Philly Shipyard Reports Profit Surge in 1Q

US-based shipbuilder Philly Shipyard closed the first quarter of this year with a net income of USD 17.2 million, considerably higher from USD 1.9 million delivered in the same period of 2016. 

During 1Q 2017, the company’s operating revenues and other income were USD 167.8 million, up from USD 35.7 million seen in the three-month period a year earlier.

As disclosed, operating revenues and other income were primarily driven by the delivery of American Freedom, the second of four next generation 50,000 dwt product tankers that the company is building for American Petroleum Tankers (APT), a subsidiary of Kinder Morgan.

In addition, the results were affected by the related sale by Philly Tankers of American Freedom’s shipping assets to Kinder Morgan and continued progress on the Matson vessels.

EBITDA for 1Q 2017 stood at USD 29.9 million, compared to USD 2 million recorded in the same quarter of 2016.

On March 31, 2017, the company had an order backlog of USD 624.4 million, with two APT’s MR2 product tankers and two Matson’s Panamax containerships under construction.

The shipbuilder said that key focus areas for its operations this year are deliveries of the abovementioned ships according to contract delivery dates.

In addition, main focus areas for Philly Shipyard’s business in 2017 would be securing new contracts and seeking capital to finance the construction of new vessels. Although there are no firm orders in place, the shipbuilder said it has started design work and procurement activities to build Hulls 031 and 032 as container vessels, with the construction planned for 2Q 2018.

“While Philly Shipyard is currently focused on large containerships for its next contracts, Philly Shipyard continues to explore potential new construction projects in other areas of the Jones Act market,” the shipbuilder said.

However, the shipbuilding company said that due to the current uncertainty in securing new orders beyond Hull 030, the PHLY Board decided not to pay dividends for the first quarter of 2017.

In line with its diversification efforts, the company has teamed up with Fincantieri Marine Group (FMG) and Vard Marine to compete for the detail design and construction of the US Coast Guard’s next generation heavy polar icebreaker.

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