Wallenius Wilhelmsen profit flat in Q3
Wallenius Wilhelmsen ended the third quarter of 2023 with a net profit of $328 million, down 1 per cent from $332 million in the second quarter of 2023 and up 34 per cent from $246 million in the corresponding quarter a year prior.
Total revenue in the quarter under review was $1.31 billion, up 1 per cent from the previous quarter, as volumes and revenues increased in the logistics and government services segments. The company added that it also sees underlying improvements in shipping. Compared to Q3-22, total revenue for the group was down 3 per cent, caused by lower fuel surcharges in the shipping services segment.
“With another positive quarter behind us, we expect EBITDA in the second half of 2023 to be at or above what we delivered in the first half, as vessel utilization remains high, and we see solid demand for our logistics services. Moreover, the contribution from government services remains strong,” says Lasse Kristoffersen, President, and CEO at Wallenius Wilhelmsen.
Shipping delivered a solid quarter with stronger underlying EBITDA on higher net rates and improved customer mix, slightly offset by a decline in fuel surcharges and volumes.
Logistics delivered solid EBITDA in Q3 driven by strong performance in auto and it was a very strong quarter for the government segment with the largest EBITDA gain quarter-over-quarter. This was due to both an improvement in cargo mix and continued high U.S. government demand.
In addition, fuel consumption continued to be further reduced in Q3, illustrating the lasting effect on consumption from fuel efficiency initiatives implemented over an extended period. Kristoffersen says, “Our efforts to reduce CO2 emissions are paying off and we see emissions trending down and stabilizing at lower levels. An additional effect is a recurring reduction in fuel consumption and fuel cost,” Kristoffersen said.
However, waiting times at key ports continued to create challenges. During the quarter, some 9 per cent of the available trading days were caught up in congestion.
Investing in newbuilds
On October 24, the company turned the LOI into contracts for four firm and eight optional 9,300 CEU methanol-capable and ammonia-ready vessels. The vessels are scheduled for delivery from mid-2026 and onwards.
“We continue to strengthen our business platform by renegotiating contracts at higher rates and securing attractively priced tonnage. We have exercised two purchase options under our long-term charter agreements, and signed contracts for four firm and eight optional newbuildings,” says Kristoffersen.