Stolt-Nielsen Limited (Oslo Børs: SNI) reported unaudited results for the second quarter ended May 31, 2016. Net profit attributable to shareholders in the second quarter was $37.8 million, with revenue of $478.9 million, compared with a net profit of $30.4 million, with revenue of $464.0 million, in the first quarter of 2016. Net profit attributable to shareholders for the first six months was $68.2 million, with revenue of $942.8 million, compared with $81.2 million, and revenue of $988.4 million, in the first half of 2015.
Highlights for the second quarter of 2016, compared with the first quarter of 2016, were:
- Stolt Tankers reported an operating profit of $45.3 million, compared with $31.2 million, reflecting increased contract of affreightment (COA) volume and a $6.5 million gain on bunker hedges.
- The Stolt Tankers Joint Service Sailed-in Time-Charter Index rose to 0.81 from 0.77.
- Stolthaven Terminals reported an operating profit of $13.8 million, up from $10.5 million, driven mainly by improved utilisation and the results of cost saving initiatives.
- Stolt Tank Containers reported an operating profit of $10.7 million, down from $11.8 million, as the positive impact of an increase in shipments and higher utilisation were offset by narrowed margins and lower results from joint ventures.
- Stolt Sea Farm reported an operating profit of $3.4 million, down from $5.5 million, mainly due to the seasonal slowdown after the holiday sales period. The accounting for inventories at fair value had a positive impact of $3.0 million, compared with a positive impact of $3.4 million in the previous quarter, as turbot prices continued to strengthen.
- Corporate and Other reported an operating loss of $3.9 million, compared with a loss of $1.2 million, due to higher equity loss on investments in associate companies.
Commenting on the Company’s results, Mr. Niels G. Stolt-Nielsen, Chief Executive Officer of Stolt-Nielsen Limited, said: “Stolt Tankers’ results continued to improve in the second quarter, driven by a combination of increased COA volumes and the positive impact of bunker hedges that we placed earlier this year. Stolthaven Terminals also reported improved results, from higher utilisation and cost-saving initiatives. At Stolt Tank Containers, shipments, utilisation and revenue were all up this quarter, but price competition held down operating income. While Stolt Sea Farm’s results were marginally down in line with seasonal factors, we are encouraged by the price increases obtained for turbot this quarter.
“Going forward, we remain guarded with respect to the outlook for Stolt Tankers in 2017 and 2018. The orderbook stands at 27% of the existing fleet, but it remains unclear how this will ultimately play out, as some delays and cancellations of newbuildings seem increasingly likely. Also, higher exports of certain commodity chemicals from the U.S. Gulf are pulling tonnage out of our niche market in specialty chemicals, thus helping to maintain our freight rates. At Stolthaven Terminals, we expect a continued gradual improvement in results into 2017, as we implement our business-improvement initiatives. At Stolt Tank Containers, price competition is unlikely to abate in the near term, so we will continue to leverage our scale and global strengths to achieve competitive advantage. The recent firming of turbot prices is good news for Stolt Sea Farm, and we expect to see improved performance at our sole farm in Iceland as the year progresses.”