WWH's Q1 2013 Profits Dip

Wilh. Wilhelmsen Holding ASA (WWH) operating profit and total income declined quarter on quarter and year over year.

The company attributes the decline in profits mainly as a consequence of continued drop in shipping volumes and a less favourable cargo mix, and in the second quarter, the group’s activity level is expected to be in line with the first quarter.

Operating profit for the first quarter was USD 78 million (USD 106 million), down 27% compared with the same period last year and a decrease of 19% from the previous quarter. Total income ended at USD 864 million (USD 946 million), a reduction of 9% year over year and 4% quarter on quarter.

“The beginning of 2013 has been challenging following the expected decline in shipping volumes, a less favourable cargo and trade mix and lower fleet utilisation. Earnings from our logistics activities improved compared with previous quarters, but do unfortunately not offset the reduced contribution from our shipping segment,” says Thomas Wilhelmsen, group CEO in WWH when explaining the decline in total income and operating profit.

Mr Wilhelmsen continues: “The maritime services segment’s total income increased 2% quarter on quarter based on higher income within ship management and technical solutions. The ships service business area experienced a minor reduction in total income. The operating profit was, however, down following a less optimal product mix within the ships service area, a somewhat weaker USD and a low margin within the growing technical solutions’ business area,” says Wilhelmsen.

“Income from our investment in the NorSea Group was up first quarter. Gain from property sales offset the impact from the seasonal reduction in activity,” explains Wilhelmsen.

The annual general meeting held on 25 April 2013 resolved to pay a dividend of NOK 3.50 per share. The dividend is payable on or about 14 May.

Commenting on the group’s future prospects, Mr Wilhelmsen says: “The shipping market in general is weak. For maritime services the situation impacts owners’ purchasing capabilities and puts pressure on demand and operating margin. For our shipping activities, we expect volumes to stabilise in the coming months. Our main concern is related to the development within the high and heavy segment.”

The group says it has a strong financial position and is well positioned to benefit from the growth potential of the markets in which it operates.