Norway's Stolt-Nielsen Q2 net profit slips to $27.5m

01 July 2010 10:03  [Source: ICIS news]

SINGAPORE (ICIS news)--Stolt-Nielsen on Thursday reported a slip in its second-quarter net profit to $27.5m (€22.6m) from $27.7m in the same period last year, as the company continued to incur losses at its liquefied petroleum gas (LPG) transportation business.

Sales for the quarter ending 31 May, however, increased 17.8% year on year to $463m, the Norwegian chemical tanker group said in a statement.

Its gas segment posted a net loss of $2.6m during the three-month period, almost a ninefold increase from year-ago levels, due to continued weakness in the “very large gas carrier market”, Stolt-Nielsen said.

“We continue to incur losses in our LPG transportation business, but we began to see some evidence of an improving trend as the quarter drew to a close,” said company CEO Niels Stolt-Nielsen in a statement.

Compared to the first quarter, however, Stolt-Nielsen’s May quarter net profit surged 46%, primarily due to improved results at the group’s Stolt Tankers and Stolt Tanker Containers (STC) divisions,  the company said.

“Stolt Tankers’s operating profit was up in absolute terms as the fleet size and volume of cargo transported increased compared with the prior quarter,” the Stolt-Nielsen executive said.

“STC’s strong results were driven by increased shipments and improved margins,” he added.

Its Stolthaven Terminals division, however, saw a 12% decrease in its operating profit in the second quarter to $13.6m.

Looking ahead, Stolt-Nielsen said that the group remained concerned about the strength of the global economic recovery.

“We believe that any growth will, at best, be modest in the coming years,” he said.

We believe some interesting opportunities will eventually surface when over-leveraged companies seek second or third rounds of waivers and or have to raise further equity in a weak and uncertain market. We are keeping our powder dry in the meantime,” Stolt-Nielsen added.

($1 = €0.82)

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By: Nurluqman Suratman

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