ACL’s net income jumps 248% in 2005
Swedish ocean carrier Atlantic Container Line’s net income soared 248 percent in 2005 to a record 46 million euros ($55 million) from 13.2 million euros in 2004.
Earnings before interest (EBIT) jumped 265.7 percent to 55.6 million euros ($66 million), compared to 15.2 million euros in the previous year. Net sales rose 18.1 percent to 339.2 million euros ($401 million), from 287.1 million euros.
ACL offers liner services for container, project and oversized cargo between North America and Europe, the Mediterranean, West Africa and the Middle East. In 2005, ACL moved 263,000 TEUs, up 2 percent from 258,000 TEUs in 2004. Ship utilization also increased 2 percent to 86 percent.
“While our competitors were distracted by mergers and acquisitions, new alliances and the wide swings of the Asian trades, ACL focused most of its attention on fine tuning its main North Atlantic business,” said Andrew J. Abbott, president and chief executive officer of ACL.
Abbott said that the company will stash some of the profits away to invest in new ships when prices comes down. “ACL’s excellent performances could not have come at a better time. The ships have 10 years commercial life left in them, and we need to start putting money aside for their replacement in 2015 or sooner,” said Abbott.
“Shipbuilding prices have skyrocketed in recent years and our average returns over the last 10 years would not be enough to afford new vessels with similar design. We would need several years like 2005 plus a large reduction in shipbuilding prices to justify an investment in new ships.
“Thankfully we can afford to have the patience to wait until vessel orders at the shipyards thin out, so prices can come down from the stratospheric levels of today.”
“The outlook for 2006 is for a year of improvement, but not as strong growth as 2005. Our ships are full and freight rates are still rising in line with costs. Fuel prices are a major unknown as due to the political instability in the Middle East, Nigeria and Venezuela coupled with growing demand in India and China,” said Abbott.
ACL is a subsidiary of Italy’s Grimaldi Group.