MPC reports second-quarter growth

Containership charterer says tariffs are a risk, but “forecasts suggest world trade will grow by 4.8 percent in 2018.”    MPC Container Ships ASA, which owns and charters smaller containerships, said, “While the summer has brought a soft weakening of rates and trade war fears pose a risk to the strong recovery of the container shipping industry seen over the last 15 months, the underlying market fundamentals remain intact for further market improvements in 2018 and 2019.”
   Reporting its earnings for the second quarter, MPC said, “The latest economic forecasts suggest that world trade will grow by 4.8 percent in 2018 and that the tariffs introduced so far will have only a minor impact on the growth of container demand. With expected fleet growth falling to 3.4 percent in 2019, analysts expect 2019 to deliver an improved supply-and-demand balance compared to 2018, based on a stable world economy and healthy demand growth.”
   MPC reported a net profit of $1.8 million in the second quarter of 2018, compared to a profit of $500,000 in the first quarter. Revenue was $46.9 million in the second quarter of 2018 versus $28.3 million in the first quarter of 2017. While the company was incorporated in January 2017, revenues in the first half of last year as it ramped up operations amounted to just $1.2 million.
   MPC said that “further improvements were achieved in the container shipping market in the first half of 2018. With fleet growth of 5.6 percent and slightly lower trade growth of 5.4 percent, the balance of supply and demand was close to equilibrium. The strength of the market was reflected in a very modest idle fleet, which accounted for around 1.5 percent of the existing fleet on average for the first half of the year.
    “Both charter rates and secondhand values rose significantly in the course of the first six months of the year. Only in recent weeks the usual seasonality has led to a weakening of charter rates in some segments.”
   MPC focuses on feeder vessels, mainly those with capacity between 1,000 and 3,000 TEUs, that are chartered out to large liner shipping companies and regional carriers.
   It has grown its fleet rapidly. As of June 30 it had acquired 68 containerships with capacities ranging from 966 TEUs to 2,846 TEUs.