Stolt-Nielsen Limited reported unaudited results for the first quarter ended February 28, 2021.
The Company reported a first-quarter net profit attributable to shareholders of $2.5 million, with revenue of $480.2 million, compared with a net profit attributable to shareholders of $13.4 million, with revenue of $480.6 million, in the fourth quarter of 2020.
Highlights for the first quarter, compared with the fourth quarter of 2020, were:
• Stolt Tankers reported operating profit of $12.9 million, down from $31.9 million, as COA volumes eased off and spot rates weakened. During the quarter the five modern stainless-steel ships bought from CTG joined the Stolt Tankers Joint Service (STJS).
• The STJS Sailed-in Time-Charter Index dropped to 0.52 from 0.60.
• Stolthaven Terminals reported operating profit of $15.7 million, up from $8.0 million. The prior quarter included a net impairment charge of $8.8 million.
• Stolt Tank Containers reported operating profit of $8.0 million, down from $13.9 million, reflecting higher ocean freight and repositioning costs.
• Stolt Sea Farm reported an operating loss before fair value adjustment of biomass of
• $0.4 million compared with an operating loss of $0.3 million.
• Corporate and Other reported an operating loss of $2.2 million compared with a loss of $3.5 million. The improvement was mainly due to insurance cost accruals in the prior quarter.
Niels G. Stolt-Nielsen, Chief Executive Officer of Stolt-Nielsen Limited, commented: “The first quarter reflected the impact of severe winter weather in the northern hemisphere, which caused delays and impacted scheduling. For Stolt Tankers, the impact was amplified by swing tonnage from the soft product tanker market, putting pressure on volumes and spot rates. February’s cold snap in Houston had a negative impact on volumes and scheduling from mid-February into the second quarter as customers were forced to shut down production capacity. For Stolthaven Terminals the cold snap required a precautionary temporary shut-down of operations, resulting in reduced throughput volumes at the Houston terminal. Stolt Tank Containers saw a continued increase in activity levels throughout the quarter with strong customer bookings, although financial results were impacted by higher ocean freight and other move-related expenses. Stolt Sea Farm continued to drive improvements in volume sold. However, the impact of further Covid-related lockdowns across Europe has slowed the expected improvement of prices.
“During the first quarter Stolt Tankers took delivery of the five 26,000 dwt stainless steel ships secured at the end of August 2020. Two of the ships were purchased by NYK Stolt Tankers, a joint venture with NYK Line. All five ships were financed at favourable terms. Stolt Tank Containers expanded its fleet by almost 2,000 tanks during the quarter. Stolthaven completed an expansion project at New Orleans, adding almost 16,000 cubic metres of storage capacity. During the quarter Stolt Sea Farm began harvesting at the new land-based sole recirculation facility at Cervo, Spain, and also started to populate a second new recirculation facility at Tocha, Portugal, with juveniles. Harvesting is expected to begin early next year. Both facilities have exceeded expectations in terms of growth of biomass and control of production cost. Preparations for a potential IPO of Stolt Sea Farm and Stolt Tankers continued during the quarter.
“Subsequent to the end of the quarter, the six-day closure of the Suez Canal disrupted operations at both Stolt Tankers and Stolt Tank Containers. It is expected that the closure will cost the Company less than $1.0 million in delays, which will be reflected in the second quarter.
“With the global roll out of vaccinations combined with economic stimulus packages announced both in the US and EU, and the economic growth recovery in China, combined with pent up demand, I am optimistic about the future for all the business divisions. With the low chemical tanker orderbook it is only a matter of time before the shipping market begins to firm. I therefore remain optimistic about the medium to long-term outlook, and look forward to a recovery beginning in earnest during the second half of this year.”
“Finally, I am happy to welcome Ms. Janet Ashdown as a nominee to the Board of Directors of SNL to be voted on at the Company’s upcoming Annual General Meeting of shareholders. Ms. Ashdown is a highly experienced Non-Executive Director with significant experience of managing complex supply chain operations at BP and has a strong interest in the energy transition, hydrogen and carbon capture, and the broader ESG agenda.”