MISC Sees Soft Shipping Rates Ahead

Thursday, January 11, 2007
MISC Bhd expects freight rates for crude oil to remain soft over the next two years as competitors put more new tankers to sea. MISC earns 90% of its profits from shipping oil and liquefied natural gas (LNG). A subsidiary of Petroliam Nasional Bhd (Petronas), the world's largest carrier of LNG. LNG is shipped under long-term contracts, but MISC still faces significant exposure to oil freight rates, with crude oil tankers accounting for 40% of its profits.

The IMO requires single hulled tankers to be phased out by 2010 to reduce the risk of oil spills. But the move has yet to make a dent in the world's fleet of oil tankers as more new tankers are launched. The Baltic Exchange's Dirty Tanker Index stands about 60% lower than its historic peak in November 2004. Analysts have said a glut of new tankers expected in the next three years could depress rates even further and hurt profits of shippers such as MISC. Shamsul said container rates were also likely to weaken as shipping capacity outstripped growth in container traffic. The container business, which accounts for nearly 30% of group revenue, made a loss for the six months ended Sept 30. But MISC's core LNG business is likely to cushion some of the blow from weak freight rates.

Shamsul declined to give a profit outlook for the current year but noted that operational profits had increased slightly. MISC, owned 62% by Petronas, posted an 11% rise in net profit for its second quarter to Sept. 30, helped by its engineering unit, which builds offshore oil-and-gas platforms. Shamsul said the unit was well placed to win more projects. MISC's net profit fell 38% to RM2.9 billion in the year ended March 31, 2006 from the previous year's record RM4.8 billion. Profit to end-March 2007 is forecast to drop further to US$2.6 billion (RM9.13 billion), according to Reuters Estimates.

MISC has a fleet of 45 petroleum tankers, including eight very large crude carriers. Three more VLCCs are on order. Source: Reuters

Maritime Reporter March 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Finance

Singapore's Marine & Offshore Sector Powering Output

Singapore's first-quarter growth could be revised higher after data on Friday showed unexpectedly strong industrial output in March, double the pace of market expectations,

Gulf Island Fab Reports Q1 2014 Revenue Increase

Houston headquartered Gulf Island Fabrication, Inc. reported net income of $3.5 million ($0.24 earnings per share) on revenue of $134.7 million for its first quarter ended March 31,

Matson Declares Q2 2014 Dividend

Leading US carriers in the Pacific, Matson, Inc., apprises it has declared a second quarter 2014 dividend of $0.16 per common share. "Today's authorization continues

Maritime Security

Cold War Revival? British Military on Guard

UK's Ministry of Defence says that warship HMS Dragon & an RAF Typhoon aircraft have been in contact with their Russian counterparts this week, as follows: The

Cold War Revival? British Military on QV

UK's Ministry of Defence says that warship HMS Dragon & an RAF Typhoon aircraft have been in contact with their Russian counterparts this week, as follows: The

Australian Warship Bags Record Heroin Haul

On the eve of Anzac Day commemorations, Royal Australian Navy (RAN) frigate 'HMAS Darwin' seized and destroyed more than one tonne of heroin. The record 1032

 
 
Maritime Contracts Maritime Standards Naval Architecture Pipelines Salvage Ship Electronics Ship Repair Shipbuilding / Vessel Construction Sonar Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1903 sec (5 req/sec)