Restructuring Affects Wilhelmsen’s Earnings

Norway-based maritime firm Wilh. Wilhelmsen Holding informed that its total income and net profit for the third quarter of 2017 were affected by mixed operating results and restructuring.

The group delivered a total income of USD 104 million in the quarter ended September 30, including a USD 40 million accounting loss from reclassification of NorSea Group from associate to subsidiary following the increase in Wilhelmsen ownership from 40% to 72%. The result represents a 54% drop compared to the total income of USD 224 million reported in the same quarter a year earlier.

Wilhelmsen’s loss for the period was at USD 23 million, compared to a profit of USD 50 million seen in the same three-month period in 2016, while its operating loss stood at USD 34 million for the quarter, mainly due to the reclassification loss, against an operating income of USD 17 million.

Although its total income for the first nine months of the year decreased by 16% to USD 589 million, the company said that its operating profit surged to USD 172 million for the period, up from USD 40 million reported in the first nine months of 2016.

The group’s maritime services segment, which includes ships service, ship management and other maritime services activities, delivered a total income of USD 142 million in the third quarter, down 3% from the previous quarter.

Operating profit and margin was also down due to reduced contribution from ships service. This was partly offset by less corporate costs for the quarter.

“New cost and organisational structures will continue to support an improved operating margin within the maritime services segment, and we expect merger synergies to positively impact net result for the holding and investment segment,” Thomas Wilhelmsen, group CEO in the Wilhelmsen group, said.

“With the structural changes we’ve been through, we have also established a strong platform for future growth, and will continue to implement initiatives to grow organically and look for profitable M&A opportunities,” Wilhelmsen added.

The group said that it “is positioned in challenging markets and have successfully completed several important structural changes creating shareholder value.”

Structural changes and performance improvement will continue to support an improvement in operating margin of main activities. However, the board expects the general business environment to remain soft, affecting most group activities and performance.

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