Belgium’s Stolt-Nielsen Limited (SNL) booked a much lower profit for the second quarter of 2018 standing at USD 9.5 million.
Compared year-on-year the net profit was halved as for Q1 2017 Stolt-Nielsen reported USD 15.7 million in profit. On a quarterly basis the drop is even bigger taking into account that the company posted USD 39.8 million in net profit for the three months ending February 31, 2018.
For the six-month period the net profit stood at USD 48.3 million, with revenue of USD 1,056.3 million, compared with USD 30.8 million and revenue of USD 976.5 million in the first half of 2017.
The second-quarter results included an USD 11.8 million impairment taken on two bitumen ships, reflecting the weak market conditions. This compares to one-time gains of USD 24.9 million from the lowering of the US federal corporate income tax rate, and USD 8.2 million from a Stolthaven joint venture from the first quarter.
During the quarter, the last of Stolt Tankers’ newbuildings was delivered from Hudong-Zhonghua Shipbuilding to SNL’s joint venture, NYK Stolt Tankers.
According to Niels G. Stolt-Nielsen, Chief Executive Officer of Stolt-Nielsen Limited, the underlying operating result was in line with expectations.
“At Stolt Tankers, we have thus far successfully compensated for rising bunker prices through the bunker hedge program, 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,” he said.
At Stolthaven, excluding one-offs, operating results were flat, while Stolt Tank Containers reported another strong quarter with solid underlying demand driving an increase in shipments.
“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,” he concluded.