Horizon Lines Continue to Improve Financial Performance in Q2 2013

MarineLink.com
Monday, August 05, 2013

Horizon Lines, Inc. reported financial results for the fiscal second quarter ended June 23, 2013 with an almost doubled EBITDA from the same period last year.

"Horizon Lines second-quarter adjusted EBITDA nearly doubled from the same period a year ago, driven largely by reduced vessel charter expense, lower dry-dock transit and crew-related expenses, lower fuel consumption, higher non-transportation revenue, reduced overhead and gains on the sale of assets," said Sam Woodward, President and Chief Executive Officer. "The positive factors driving adjusted EBITDA growth were partially offset by reduced container volume and increased vessel operating expenses. Second-quarter results demonstrate that we are executing on our plan to improve Horizon Lines' financial performance."

Second-Quarter 2013 Financial Highlights  

  • Volume, Rate & Fuel Cost – Container volume for the 2013 second quarter totaled 56,159 revenue loads, down 6.0% from 59,768 loads for the same period a year ago. The decline was primarily a result of the reduced number of sailings between Jacksonville and San Juan. Unit revenue per container totaled $4,263 in the 2013 second quarter, compared with $4,269 a year ago.  Second-quarter unit revenue per container, net of fuel surcharges, was $3,250, up 2.6% from $3,168 a year ago. Vessel fuel costs averaged $659 per metric ton in the second quarter, 10.1% below the average price of $733 per ton in the same quarter a year ago.  
  • Operating Revenue – Second-quarter operating revenue declined 4.1% to $259.8 million from $270.9 million a year ago.  The factors driving the $11.1 million revenue decrease were an $11.5 million volume contraction, largely due to reduced sailings out of Jacksonville, and lower fuel surcharges of $8.2 million.  These items were partially offset by a $4.5 million increase in container revenue rates, and a $4.1 million rise in non-transportation revenue.  The improvement in non-transportation revenue was primarily due to an increase in certain transportation services agreements and other services.
  • Operating Income – Operating income for the second quarter totaled $16.0 million, compared with $1.0 million a year ago.  The $15.0 million improvement was primarily driven by a $3.9 million reduction in vessel lease expense, $2.9 million in lower dry-dock transit and crew-related expenses, and a $2.5 million improvement in fuel recovery primarily due to lower fuel consumption.  2013 second-quarter operating income includes expenses totaling $0.5 million primarily associated with the return of excess equipment related to the 2012 fourth-quarter service change in Puerto Rico. 2012 second-quarter operating income includes $1.2 million of antitrust-related legal expense, refinancing costs, an impairment charge and severance expense. Excluding these items, second-quarter 2013 adjusted operating income totaled $16.5 million, compared with $2.2 million a year ago.  (See reconciliation tables for specific line-item amounts.)
  • EBITDA – EBITDA totaled $28.8 million for the 2013 second quarter, compared with negative $0.6 million for the same period a year ago.  Adjusted EBITDA for the second quarter of 2013 was $29.2 million, an increase of 92.1% from $15.2 million for 2012.  EBITDA and adjusted EBITDA for the 2013 and 2012 second quarters were impacted by the same factors affecting operating income.  Additionally, 2013 adjusted EBITDA reflects the exclusion of $0.1 million of non-cash gains on marking the conversion feature in the company's convertible debt to fair value.  Adjusted EBITDA for the 2012 second quarter also reflects the exclusion of a primarily non-cash net loss of $14.9 million, resulting from a $47.7 million loss on the conversion of debt to equity, which was partially offset by a $32.8 million gain on marking the conversion feature of the company's convertible debt to fair value.  (See reconciliation tables for specific line-item amounts.)
  • Net Loss – The second-quarter net loss from continuing operations totaled $0.9 million, or $0.02 per share, on a weighted average of 35.6 million shares outstanding. This compares with a year-ago net loss of $31.1 million, or $1.55 per share, on a weighted average of 20.1 million shares outstanding.  On an adjusted basis, the second-quarter net loss from continuing operations totaled $0.1 million, or $0.00 per share, compared with an adjusted net loss of $14.8 million, or $0.74 per share, a year ago.  The 2013 and 2012 second-quarter net losses reflect the same items impacting adjusted EBITDA.  Additionally, the adjusted net loss for the 2013 second quarter excludes the non-cash accretion of the estimated multi-employer pension plan withdrawal liability related to our move from Elizabeth, New Jersey to Philadelphia, Pennsylvania, and the adjusted net loss for both the 2013 and 2012 periods excludes the non-cash accretion of payments associated with antitrust-related legal settlements, and includes the tax impact of the adjustments. (See reconciliation tables for specific line-item amounts.)

Outlook
Management continues to expect full fiscal year revenue container volume, excluding the loss of revenue loads associated with the reduced number of sailings between Jacksonville and San Juan, and rates to be slightly higher than 2012 levels.  Revenue container rate increases are necessary to mitigate contractual and inflationary growth in expenses, including the company's vessel payroll and benefits, stevedoring, port charges, wharfage, inland transportation, and rolling stock costs, among others.
 

Maritime Reporter March 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

ABS CEO Lays Out Vision for Technical Leadership at CMA Shipping

During the recent CMA Shipping 2015 conference in Stamford, Connecticut, ABS Chairman and CEO Christopher J. Wiernicki provided the conference's keynote address

Oceanex Named One of Canada’s Best Managed Companies

Oceanex Inc. was named one of Canada’s Best Managed Companies Gold Standard Members in 2014. This national award is sponsored by Deloitte, CIBC, National Post,

Navy Awards Austal $691M for Two Littoral Combat Ships

The U.S. Navy has ordered two new littoral combat ships from Austal, the shipbuilder said in a press release today. The two orders, worth $691 million, are part

Ports

Bulk Carrier Runs Aground in Delaware River (Link to Video)

Coast Guard Sector Delaware Bay is investigating a ship aground in the Delaware River near the Burlington Bristol Bridge, which connects Burlington, NJ and Bristol Township, PA.

Tanker Backlog Builds at Basra

Ships face up to a three week wait; bad weather in February delayed loading, created backlog. * April intake to be reduced to clear backlog By Keith Wallis SINGAPORE,

U.S. Port Delay Boost February Air Freight

Global air freight volumes rose 11.7 percent year-on-year in February, driven by the Chinese New Year, the International Air Transport Association said on Wednesday.

Finance

BMT Partners with Aage Hempel

BMT SMART (BMT),  has announced  that Aage Hempel has become an accredited service partner.  This agreement will provide both organizations with the opportunity

Tanker Backlog Builds at Basra

Ships face up to a three week wait; bad weather in February delayed loading, created backlog. * April intake to be reduced to clear backlog By Keith Wallis SINGAPORE,

U.S. Port Delay Boost February Air Freight

Global air freight volumes rose 11.7 percent year-on-year in February, driven by the Chinese New Year, the International Air Transport Association said on Wednesday.

Container Ships

ABS CEO Lays Out Vision for Technical Leadership at CMA Shipping

During the recent CMA Shipping 2015 conference in Stamford, Connecticut, ABS Chairman and CEO Christopher J. Wiernicki provided the conference's keynote address

U.S. Port Delay Boost February Air Freight

Global air freight volumes rose 11.7 percent year-on-year in February, driven by the Chinese New Year, the International Air Transport Association said on Wednesday.

Largest Vessel to Call ICTSI, Rijeka

Adriatic Gate Container Terminal (AGCT), International Container Terminal Services, Inc.’s (ICTSI) container handling facility in the Port of Rijeka, Croatia, recently

Logistics

Oceanex Named One of Canada’s Best Managed Companies

Oceanex Inc. was named one of Canada’s Best Managed Companies Gold Standard Members in 2014. This national award is sponsored by Deloitte, CIBC, National Post,

Hapag-Lloyd Improves Safety of Dangerous Goods Transportation

Last year, Hapag-Lloyd discovered 2,620 cases of incorrectly declared dangerous goods that were prevented from being shipped. Dangerous goods experts at Hapag-Lloyd investigated over 162,

Baltic Sea Freight Index Down on Lower Rates

The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, fell on Wednesday, pulled down by a fall in rates across all vessel segments.

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Maritime Standards Naval Architecture Pipelines Salvage Ship Repair Ship Simulators Sonar
rss | archive | history | articles | privacy | terms and conditions | 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: 0.1784 sec (6 req/sec)