Stolt-Nielsen Limited Reports Unaudited Results For the Third Quarter and First Nine Months of 2017
LONDON, October 9, 2017 - Stolt-Nielsen Limited (Oslo Børs: SNI) today reported unaudited results for the third quarter ended August 31, 2017. Net profit attributable to shareholders in the third quarter was $18.5 million, with revenue of $513.8 million, compared with a net profit of $15.6 million, with revenue of $500.8 million, in the second quarter of 2017. Net profit attributable to shareholders for the first nine months was $49.2 million, with revenue of $1,490.2 million, compared with $90.3 million, with revenue of $1,416.9 million, in the first nine months of 2016.
Highlights for the third quarter of 2017, compared with the second quarter of 2017, were:
- Hurricane Harvey, which hit the US Gulf Coast in late August, caused no physical damage to Company property. However, due to closure of the Houston Ship Channel, operational shutdowns and port delays, the third and the fourth quarter results have been and will be impacted, but the impact is not expected to be material.
- Stolt Tankers reported an operating profit of $34.4 million, up from $27.6 million, mainly reflecting the impact of gains related to the Company's bunker hedging programme.
- The Stolt Tankers Joint Service Sailed-in Time-Charter Index slipped to 0.64 from 0.67.
- Stolthaven Terminals reported an operating profit of $16.0 million in the third quarter, essentially unchanged from the previous quarter.
- Stolt Tank Containers reported an operating profit of $14.8 million, up from $13.7 million, driven in part by improved margins and higher equity income from STC's joint venture cleaning and repair depots.
- Stolt Sea Farm's operating profit before the fair value adjustment of inventories was $0.4 million, compared with an operating profit of $0.7 million in the second quarter. The accounting for inventories at fair value had a negative impact of $2.9 million in the third quarter, compared with a positive impact of $1.7 million in the second quarter.
- Corporate and Other reported an operating loss of $6.7 million, compared with a loss of $8.2 million, mainly reflecting lower restructuring expenses and implementation costs related to the acquisition of JO Tankers.
Commenting on the Company's results, Mr. Niels G. Stolt-Nielsen, Chief Executive Officer of Stolt-Nielsen Limited, said: "While SNL's third-quarter results were up, the improvement was largely driven by unrealised gains related to the bunker-hedging programme at Stolt Tankers. Excluding the impact of that programme, results at Stolt Tankers were down slightly, as market conditions continued to soften during the quarter. Results at Stolthaven Terminals were once again largely in line with those of the previous quarter, as we continue to implement actions aimed at improving that division's sustained long-term performance. Stolt Tank Containers continued to show evidence of margin improvement, along with lower empty repositioning costs and improved contributions from joint-venture depots. Results at Stolt Sea Farm weakened marginally in the third quarter-excluding the impact of fair value adjustments-though turbot sales increased, reflecting in part additional volume sold on consignment."
"As we reported on August 30, Hurricane Harvey caused no material physical damage to the Company's assets in Houston, and there were no spills or contamination of products. In fact, we have taken steps in recent years to improve the hurricane preparedness of our terminal facility and our tank container depot along the Houston Ship Channel-and those actions proved effective. That said, our tanker, terminal and tank-container operations all experienced some losses and additional costs because of the storm, though the financial impact, which is not expected to be material, will mostly be felt in the fourth quarter. Hurricane Irma had no impact on our operations."
"On balance, our overall outlook remains unchanged. We do not anticipate any substantial improvement in the chemical tanker market until the latter part of 2018, when the current orderbook will have been significantly reduced and the balance between tonnage supply and demand improves. For Stolthaven Terminals, we continue to expect a modest but steady improvement in results, driven by actions to enhance operational performance across our network of terminals. At Stolt Tanker Containers, we expect margins and utilisation to hold steady at current levels. Consistent with seasonal patterns, Stolt Sea Farms' results are expected to improve in the fourth quarter, driven in part by strengthening prices ahead of the holiday sales season."