A dive in ocean shipping revenues, higher costs and an increased tax bill sent South American diversified shipowner Ultrapetrol to a larger loss in the third quarter.
The Nasdaq-listed company did, however, report strong growth in its river shipping and offshore services divisions as it said Brazil’s offshore market is set to grown “substantially”.
The sale of three capesizes as well as negative forward freight agreement settlements damaged operating profit in the company’s ocean shipping wing where revenues for the three months to the end of September sank from $30.74m to $13.51m.
This contributed to an overall fall in net profit from $4.18m to $6.98m despite total revenues staying virtually unchanged at $58.61m. Running costs for ocean shipping remained the same, however, while they increased in other business segments.
Ultrapetrol’s other business segments fared much better, however, with river shipping pulling in sales of $31.37m as against $20.4m a year earlier while offshore services grabbed $13.74m, almost double the $7.33m seen a year ago.
Continued normalising of iron ore production and the recovery of the Paraguayan soybean market following last year’s severe droughts sent river shipping volumes up over 21%. Iron ore volumes transported alone were up 36% with Ultrapetrol benefitting from the use of new barges, more efficient engines and carrying diversified cargoes.
The owner pointed to expected continued cheer in the offshore supply market, writing in Thursday’s stock exchange announcement: “We believe that the Brazilian market will grow substantially with the support of Petrobras' aggressive capital expenditure plans”.
