Stolt-Nielsen S.A. reports unaudited results for Q3
Stolt-Nielsen S.A. yesterday reported unaudited results for the third quarter and nine months ended August 31, 2009. Highlights for the third quarter of 2009 compared with the second quarter of 2009 included: * Net profit attributable to shareholders increased to $30.9 million from $27.7 million. * Revenue rose to $429.1 million from $393.3 million. * Stolt Tankers reported an operating profit of $14.2 million, up from $1.7 million, driven by customer inventory replenishment and rising demand in China and other Asian markets. * The Stolt Tankers Joint Service Sailed-in Time-Charter Index[1] increased by 10.1% to 1.20 from 1.09. * Stolthaven Terminals reported an operating profit of $14.0 million, up from $11.9 million, reflecting growth in both revenue and equity income from joint ventures. * Stolt Tank Containers reported an operating profit of $13.2 million, down from $18.4 million, as margins narrowed due to higher ocean freight costs and increased price competition. * Stolt Sea Farm reported an operating profit of $0.5 million, down from $4.9 million. Results were negatively affected by a $1.2 million reduction in the fair market value of inventories, compared with a $4.0 million increase in the prior quarter.
Commenting on the Company's results, Mr. Niels G. Stolt-Nielsen, Chief Executive Officer of SNSA, said:
"SNSA's third-quarter results in tankers were stronger than expected. Our performance in tankers reflected a pickup in chemical exports to China, driven in part by the effects of China's economic stimulus programme. A substantial portion of the specialty-chemical volumes we carried to Asia this quarter originated in the U.S. Gulf, where the weak dollar and low natural gas prices have made U.S. exports more competitive. The tank container division's third-quarter margins were squeezed as a large number of container ships were laid up, which reduced supply and resulted in higher ocean freight cost. Terminals' profits continued to grow as more capacity was commissioned."
"Despite the strength of our third-quarter performance, we continue to believe that 2010 and 2011 will be challenging years for the chemical tanker industry. The strength of the economic recovery and the fundamentals of supply and demand remain the key issues. We expect growth in global demand to be more than offset by the increased supply of ships, as a large number of newbuildings is expected to enter the market. This imbalance will persist until more ships are recycled, or until we see a material and sustained surge in global trade, either of which could take up to 24 months. The impact on the more sophisticated parcel tanker niche may be less dramatic as the newbuilding orderbook is more in line with the expected growth in demand."
[1] The Stolt Tankers Joint Service ("STJS") Sailed-in Time-Charter Index is an indexed measurement of the sailed-in rate for the Joint Service and was set at 1.00 in the first quarter of 1990 based on the average sailed-in time-charter result for the fleet at the time. The sailed-in rate is a measure frequently used by shipping companies, which subtracts from the ships' operating revenue the variable costs associated with a voyage, primarily bunker cost, port costs, sublets, transshipments and commissions. In the third-quarter of 2009 Stolt-Nielsen Inter Caribbean Service was separated from the STJS and will be treated as a regional small-tanker service going forward. The impact on the STJS sailed-in index was positive 2.3% for the quarter. Without this change the index would have been 1.17. We do not consider this change to be material and have therefore not restated prior periods' index values.
Commenting on the Company's results, Mr. Niels G. Stolt-Nielsen, Chief Executive Officer of SNSA, said:
"SNSA's third-quarter results in tankers were stronger than expected. Our performance in tankers reflected a pickup in chemical exports to China, driven in part by the effects of China's economic stimulus programme. A substantial portion of the specialty-chemical volumes we carried to Asia this quarter originated in the U.S. Gulf, where the weak dollar and low natural gas prices have made U.S. exports more competitive. The tank container division's third-quarter margins were squeezed as a large number of container ships were laid up, which reduced supply and resulted in higher ocean freight cost. Terminals' profits continued to grow as more capacity was commissioned."
"Despite the strength of our third-quarter performance, we continue to believe that 2010 and 2011 will be challenging years for the chemical tanker industry. The strength of the economic recovery and the fundamentals of supply and demand remain the key issues. We expect growth in global demand to be more than offset by the increased supply of ships, as a large number of newbuildings is expected to enter the market. This imbalance will persist until more ships are recycled, or until we see a material and sustained surge in global trade, either of which could take up to 24 months. The impact on the more sophisticated parcel tanker niche may be less dramatic as the newbuilding orderbook is more in line with the expected growth in demand."
[1] The Stolt Tankers Joint Service ("STJS") Sailed-in Time-Charter Index is an indexed measurement of the sailed-in rate for the Joint Service and was set at 1.00 in the first quarter of 1990 based on the average sailed-in time-charter result for the fleet at the time. The sailed-in rate is a measure frequently used by shipping companies, which subtracts from the ships' operating revenue the variable costs associated with a voyage, primarily bunker cost, port costs, sublets, transshipments and commissions. In the third-quarter of 2009 Stolt-Nielsen Inter Caribbean Service was separated from the STJS and will be treated as a regional small-tanker service going forward. The impact on the STJS sailed-in index was positive 2.3% for the quarter. Without this change the index would have been 1.17. We do not consider this change to be material and have therefore not restated prior periods' index values.