LEIF HOEGH SHIPPING GROUP QUADRUPLES PROFITS
Leif Hoegh, the Norwegian shipowner that owns the car-carrying group HUAL, defied the current gloom in the global shipping market by posting a 327-percent increase in net profits for 2001, to $83 million.
For the fourth quarter, Hoegh reported a net profit of $9 million, as compared to a deficit of $13 million in the fourth quarter of 2000.
The higher profit results came from both improved operating profits and from one-off gains on the sale of shares and subsidiaries.
Hoegh said that its group consolidated operating profit before sales gain and depreciation increased by 32 percent last year, to $164 million. Net profit per share increased by 336 percent to $2.62.
Group freight revenues decreased to $680 million, from $774 million in 2000, partly because of the sale of liner and reefer shipping activities. Operating profit increased to $102 million, from $56 million in 2000.
“The improvement came largely as a result of the positive development within HUAL, but contract shipping, H'egh Lines and the reefer vessels also contributed to the good result,” Hoegh said. The operating profit includes a gain of $15 million, of which $13 million came from Hoegh’s former reefer shipping arm, Cool Carriers AB.
Hoegh’s results last year were also boosted by the sale of shares in Teekay Shipping Corp., with a gain of $36 million.
Commenting on its operating results by division, Hoegh said that after a disappointing first quarter, HUAL’s development has been positive throughout the year, including the fourth quarter.
HUAL’s annual operating profit increased to $61 million, from $46 million, and its fourth-quarter operating profit jumped to $15 million, up from $11 million.
“HUAL demonstrated again its high level of flexibility, and its position within the transportation of second-hand cars and high/heavy cargo,” Hoegh said. Cargo availability in the fourth quarter was generally lower in the important outbound markets from Japan/Korea. This was, to a large extent, compensated by a positive development in the markets from Europe to Africa and the Mideast, and from the U.S. to the Mideast and the Far East.
In contract shipping, operating profit was virtually unchanged last year, at $17 million.
Operating profit for H'egh Lines in 2001 was $14 million, up from $2 million.
Operating profit from reefer shipping, including a gain on the sale of Cool Carriers, amounted to $21 million in 2001, up from $4 million in 2000.
For the group as a whole, the fourth-quarter operating profit before gain on sale of vessels and depreciation was $39 million, up from $27 million in the same quarter in 2000. Operating profit soared to $20 million, from $3 million. Net profit amounted to $9 million, as compared to a loss of $13 million, and freight revenues dropped to $172 million, from $201 million.
Commenting on its trading prospects for 2002, Hoegh said that low global economic growth in 2001 is expected to continue into 2002, with a certain hope of improvements in the second half of the year. “The operating profit, excluding sales gains/losses is expected to be similar to that of 2001,” the Norwegian group said. “Net profit is, however, expected to be lower than that of 2001, which included considerable gains from the sales of both Cool Carriers AB and the shares in Teekay.”