Rickmers' Cash Flow Steady, But Profits Down in 2012
Rickmers Trust Management's Rickmers Maritime reports 4Q and full year financial report for 2012.
- Steady operating cash flow for the year at US$109.2 million
- High operational efficiency for 4Q2012 and FY2012 with 99.8% and 98.9% fleet utilisation rate respectively
- Kaethe C. Rickmers’ charter extended with MSC until September 2013
- Distribution per unit of 0.60 US cents to be paid on 28 March 2013
Charter revenue in 4Q2012 remained steady at US$36.3 million (4Q2011 at US$37.8 million). The slight decrease of US$1.5 million was due mainly to the lower daily charter rate of the vessel, Kaethe C. Rickmers. On a full year basis, revenue declined by 3% from US$149.5 million in FY2011 to US$144.3 million in FY2012.
Vessel operating expenses increased from US$8.4 million in 4Q2011 to US$8.8 million in 4Q2012 due to a contractual increase in fixed operating expenses and the vessel management fee that took effect from 1 January 2012, as well as higher lubricant oil prices, additional insurance, anti-piracy related expenses and fuel consumed during unscheduled off-hire.
An annual review on the entire fleet for impairment resulted in a provision for vessel impairment of US$4.5 million on Kaethe C. Rickmers and goodwill impairment of US$2.1 million on three wholly owned subsidiary companies.
As a result of the marginal decline in charter revenue, increase in operating expenses and one-off non-cash impairment charges to vessel values, the Trust’s net profit after tax decreased from US$11.3 million in 4Q2011 to US$2.2 million in 4Q2012.
On a full year basis, the Trust’s profit for 2012 was US$27.6 million, which is US$12.7 million lower than the profit recorded in the previous financial year.
For 2013, containership capacity growth is forecasted at 6.6%1 while global trade growth is projected to reach 6.1%1. However with a significant number of ships to be delivered in the next twelve months, and demand unlikely to absorb over-supply in 2013, no material increases in time charter rates and vessel values are expected in the short term.
The Chief Executive Officer of RTM, Mr Thomas Preben Hansen commented, “Improved industry fundamentals coupled with a possible stabilisation of the world’s major economies, may pave the way for a brighter future for container shipping. However, liner companies will have to delicately manage their tonnage supply and maintain strict freight rate discipline, if the industry is to continue its recovery in 2013.