Lorenzo Shipping posts 78% income drop
Lorenzo Shipping Corp. reported a sharp decrease in net income last year after the increase in freight revenue was not enough to offset rising costs, Business Mirror reports. In its disclosure at the Philippine Stocks Exchange, the company reported a net income of P11.2 million in 2011, 78-percent lower than the previous year’s P52-million profit.
The company said its freight revenue increased by 10 percent to P1.72 billion due to its implementation of the increase in bunker surcharge during the early part of the year. All gains from freight, however, were wiped out by the 15-percent increase in expenses due to the hike in fuel costs. “During the year the company spent P100 million on dry-docking of two vessels,” the company said in its report.
Its terminal expenses increased by about 6 percent due to increase in cargo-handling and delivery costs as well as terminal repairs and maintenance costs. In 2011, the company did not buy any vessel, which will be used to replace its ageing ships, due to the uncertainties brought about by the high fuel prices.
In January, however, it signed a memorandum of agreement with a foreign firm for the acquisition of MV Siefke, a ship built in 2002. It has a capacity to load 400 twenty-foot equivalent units (TEU) and has a top speed of 14 knots.
The vessel will soon to be renamed as MV Lorcon General Santos, to replace its 34-year old vessel, the MV Lorcon Davao. “This move would help improve service reliability as well as help reduce fuel and maintenance costs,” the company said.