Eimskip’s Q2 net earnings soar 58.7%

The Icelandic shipping company reported net earnings of 8.8 million euros on revenues of 126.1 million euros for the second quarter of 2016.    Icelandic shipping company Eimskip reported net earnings of 8.8 million euros (U.S. $9.9 million, based on today’s exchange rate) for the second quarter of 2016, a 58.7 percent year-over-year increase.
   Eimskip’s earnings before interest, taxes, debt and amortization (EBITDA) jumped 21.6 percent from the second quarter of 2015 to 16.2 million euros.
   However, revenues slipped 0.4 percent year-over-year to 126.1 million euros.
   Revenues in the liner services segment totaled 95.9 million euros, a 5.4 percent increase from the same period in 2015. The segment’s volumes rose 9.1 percent due to good growth related to Iceland and Norway.
   Meanwhile, revenues in the forwarding services segment slipped 15.2 percent year-over-year to 30.2 million euros, primarily resulting from lower transport rates from the international deep sea lines between Asia and Europe. The segment’s volumes trickled down 1.2 percent due to decreased reefer forwarding from China, even though other markets have been growing.
   In May, Eimskip signed a letter of intent with Royal Arctic Line, the national carrier of Greenland, to connect Greenland with Eimskip’s sailing system, Eimskip President and CEO Gylfi Sigfússon said. The companies have been evaluating and formalizing the possible cooperation since then, regarding container vessel investments and connecting sailing systems. “The project is progressing as planned and we expect a final decision shortly,” Sigfússon said.
   Looking ahead, Eimskip’s EBITDA forecast for the full year of 2016 remains unchanged, with a range of 49 million euros to 53 million euros.
   “The outlook for the third quarter is in line with the company’s expectations and the rest of the year looks positive,” Eimskip said. “Continued volume growth I expected in the Icelandic market, volumes in the Faroe Islands are expected to be similar to last year’s and the outlook for the reefer market in Norway remains positive. Forwarding services, reefer forwarding and dry cargo forwarding, started off well in the first quarter but there was a slight volume decreases in the second quarter, resulting in 2.2 percent volume growth in the first six months. The reefer forwarding has been below expectations due to the economic conditions in China, while the dry cargo forwarding has been on a good track and similar growth is expected throughout the year.”
   Eimskip was founded 1914 and currently has about 1,600 employees. The shipping carrier operates 20 vessels, 13 of which are owned and seven of which are chartered. Thirteen of the vessels operate on scheduled services, three are deployed on spot services, one is used for bulk cargo and three are in ferry operation.