Profit blow to Saudi shipper Bahri

Bahri has announced a net profit of SR 144.5 million for the three-month period ended March 31, 2013 in its interim consolidated financial results.
The net profit for Q1 marks a decrease of 9.7 percent when compared to SR 160.1 million for the corresponding quarter of previous year, and an increase of 98 percent compared to SR 73 million for the previous quarter.
Gross profit, for 3-months, totaled SR 115.6 million compared to SR 180.4 million for the corresponding quarter of previous year, a decrease of 35.9 percent.
Operating profit for Q1 totaled SR 86.4 million compared to SR 151.1 million for the corresponding quarter of previous year, a decrease of 42.8 percent.
Earning per share (EPS) from the Q1 net profit totaled SR 0.46 compared to SR 0.51 for the corresponding quarter of previous year.
Bahri CEO Saleh N. Al-Jasser has attributed the main reason for the decrease in the Q1 net profit in comparison to the corresponding quarter in 2012 to lower average time charter equivalent (TCE) rates achieved in the spot market for crude oil VLCC transportation.
Although the net profit decreased in this quarter, the average TCE rates achieved exceeded the average prevailing rates in the spot market during this quarter.
This is mainly due to the fact that most of Bahri VLCCs were employed within Saudi Aramco’s crude oil VLCC transportation program as per the interim arrangement, which became effective from Jan. 1, 2013 pursuant to the terms of the transaction agreements.
The increase in the Q1 net profit in comparison to the previous quarter is due to higher average time charter equivalent (TCE) rates achieved in the crude oil VLCC transportation, which resulted from employing most of Bahri VLCCs fleet in Saudi Aramco’s crude oil VLCC transportation program.
In addition, there is a net income increase of the National Chemical Carriers Ltd. Co. (NCC), which is owned 80 percent by Bahri and 20 percent by SABIC (Saudi Basic Industries Corporation). Furthermore, an extraordinary item of SR 51.7 million generated an income from disposal of two RORO (roll-on roll-off) vessels as a scrap after depleting their useful life with a net gain of SR 38 million. Also, there has been a net gain of SR 13.7 million resulting from National Chemical Carriers’ cancelation of its shipbuilding contract for a chemical tanker.