STX Pan Ocean (Korea) Q4 profit quadruples
STX Pan Ocean Co., Korea's largest carrier of iron ore, grain and other products, said fourth-quarter profit almost quadrupled because it charged more to move cargo.
Net income surged to $97 million, or 5.7 cent a share, in the three months ended Dec. 31, from $25 million, or 1.5 cents, a year earlier, Seoul-based STX Pan Ocean said in a statement yesterday in Singapore. Sales increased 47 percent to $862 million.
Rising demand by China, the world's biggest producer and user of steel, has pushed the rates for transporting commodities to the highest in almost two years.
More shipping lines are taking out older vessels from service to sell them as scrap metal, which may drive rates higher.
"We believe the continued strength of iron ore imports by China and longer voyages will continue to be among the catalysts to propel growth in the dry-bulk market," Lee Jong-chul, chief executive officer of STX Pan Ocean, said in the statement.
The Baltic Dry Index, which measures the cost of chartering different-size vessels, traded at 4,397 at the end of last year, 83 percent higher than the 2,407 at the end of 2005, according to the Baltic Exchange in London. The index rose to 4,704 Wednesday, the highest since April 2005.
Sales from its dry-bulk operations, which accounted for 89 percent of its total revenue, increased 48 percent in the fourth quarter from a year earlier to $765 million. That was helped by growing demand to ship iron ore to China from Brazil as well as to Asian countries from Australia.
STX Pan Ocean's full-year profit fell 54 percent to $129 million because of loss from forward freight agreement and higher fuel costs. Sales rose 8.3 percent to a record $2.9 billion in 2006.
The shipping line will pay a final dividend of 2.3 cents per share to shareholders.
STX Pan Ocean plans to expand its tanker operations. It ordered three tankers for $130 million from STX Shipbuilding Co., the biggest shareholder of the shipping line.
Delivery of the vessels will be completed in 2008, STX Pan Ocean said in a separate statement filed to the Singapore stock exchange yesterday.
Net income surged to $97 million, or 5.7 cent a share, in the three months ended Dec. 31, from $25 million, or 1.5 cents, a year earlier, Seoul-based STX Pan Ocean said in a statement yesterday in Singapore. Sales increased 47 percent to $862 million.
Rising demand by China, the world's biggest producer and user of steel, has pushed the rates for transporting commodities to the highest in almost two years.
More shipping lines are taking out older vessels from service to sell them as scrap metal, which may drive rates higher.
"We believe the continued strength of iron ore imports by China and longer voyages will continue to be among the catalysts to propel growth in the dry-bulk market," Lee Jong-chul, chief executive officer of STX Pan Ocean, said in the statement.
The Baltic Dry Index, which measures the cost of chartering different-size vessels, traded at 4,397 at the end of last year, 83 percent higher than the 2,407 at the end of 2005, according to the Baltic Exchange in London. The index rose to 4,704 Wednesday, the highest since April 2005.
Sales from its dry-bulk operations, which accounted for 89 percent of its total revenue, increased 48 percent in the fourth quarter from a year earlier to $765 million. That was helped by growing demand to ship iron ore to China from Brazil as well as to Asian countries from Australia.
STX Pan Ocean's full-year profit fell 54 percent to $129 million because of loss from forward freight agreement and higher fuel costs. Sales rose 8.3 percent to a record $2.9 billion in 2006.
The shipping line will pay a final dividend of 2.3 cents per share to shareholders.
STX Pan Ocean plans to expand its tanker operations. It ordered three tankers for $130 million from STX Shipbuilding Co., the biggest shareholder of the shipping line.
Delivery of the vessels will be completed in 2008, STX Pan Ocean said in a separate statement filed to the Singapore stock exchange yesterday.