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Stolt-Nielsen sees Q4 profits rise on strong markets

Stolt-Nielsen Limited reported unaudited results for the fourth quarter and full year 2022.

The Company reported a fourth-quarter net profit of $95.3 million, with revenue of $732.5 million, compared with a net profit of $74.7 million, with revenue of $744.0 million, in the third quarter. The net profit for the full year was $280.9 million, with revenue of $2,771.8 million, compared with a net profit of $78.8 million, with revenue of $2,181.1 million, in 2021. The EBITDA for the full year 2022 was $715.3 million, up from $536.6 million in 2021.

Highlights for the fourth quarter, compared with the third quarter of 2022, were:

  • EBITDA of $196.0 million, up from $184.4 million.
  • Stolt Tankers reported operating profit of $78.2 million, up from $61.1 million, largely driven by higher spot rates and improved volume.
  • The STJS average sailed-in revenue for the quarter was $27,162 per operating day, up from $24,341.
  • Stolthaven Terminals reported operating profit of $20.8 million, compared with $20.7 million.
  • Stolt Tank Containers (STC) reported operating profit of $44.9 million, up from
  • $43.1 million. Higher demurrage revenue offset a decrease in shipments while margins held steady.
  • Stolt Sea Farm reported an operating profit before fair value adjustment of biomass of $3.3 million, down from $6.1 million, reflecting lower sales volume due to seasonal impacts.
  • Stolt-Nielsen Gas reported an operating loss of $2.9 million, compared to a loss of $2.0 million.
  • Corporate and Other reported an operating loss of $10.4 million compared with a loss of $14.8 million.

Niels G. Stolt-Nielsen, Chief Executive Officer of Stolt-Nielsen Limited, commented: “The fourth quarter capped a stellar year, where all businesses performed well. The improvements seen in our markets were key, as well as our steadfast focus during recent years on implementing and delivering on our strategies for each of the businesses. Stolt Tankers’ net profit improved for the fourth consecutive quarter as chemical tanker spot rates and volumes continued to improve. Results at Stolthaven Terminals remained unchanged. Continued improvements at our Houston and New Orleans terminals in the US were offset by softness in other regions, most notably Europe. Stolt Tank Containers, the star performer of 2022, delivered another strong quarter following their success at maintaining margins as container liner freight rates declined. At Stolt Sea Farm, seasonality is reflected in the weaker fourth quarter results, where focus was on production and preparations for the peak Christmas season sales during December.

“For Stolt Tankers, the fourth quarter into the first quarter is the peak contract renewal season with about 55% of total contracts up for negotiations. The average rate increase on the contracts renewed in the fourth quarter was approximately 30%, which will have a positive impact on future earnings. In addition we have successfully tightened terms in the contracts. About 16% of our contract portfolio has not been renewed as some customers were not prepared to accept the increases we asked for. Most of these customers are currently operating in the spot market. With little to no growth in the global chemical tanker fleet in the next few years, and newbuilding orders not available for delivery prior to 2026, we expect continued strengthening of our tanker markets.

“At Stolthaven Terminals, high utilisation at our Houston and New Orleans, US, terminals and elsewhere, will allow for increased storage rates, although we are seeing areas with softness, particularly in Europe. We therefore expect to see similar performance from Stolthaven Terminals in 2023.

“At Stolt Tank Containers, the impact of the increased space on container liners means we are also seeing stronger competition leading to margin pressure. Reduced volumes out of Europe reflect the strain on the European chemical industry caused by high energy costs; however, this is countered by the opening up of China, driving renewed volumes out of Asia, while the Americas remain flat. Overall we expect STC’s 2023 results to be in line with our pre-2022 historical earnings.

“At Stolt Sea Farm we expect slightly lower prices in 2023 from our turbot sales due to the recessionary pressure impacting the hospitality sector. We expect continued growth in both volume and prices from sole operations.”

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