Mercator Reports 10% Decline in Revenue

Wednesday, 01 February 2012 18:52

Written by Hans GN

SINGAPORE, Indonesia Today - Mercator Lines (Singapore) Limited, a leading Indian-owned international dry bulk shipping company focused on high growth markets such as India and China, today announced a decrease of 10% in revenues to USD 109.3 million for the first nine months of Financial Year 2011-2012 ending 31st March 2012, as compared to USD 121.7 million for the corresponding period previous year.

The total number of vessel operating days grew by about 13% during the period from 4153 days 2011 to 4702 days during the period due to capacity expansion. The Time Charter Equivalent (TCE) rate per vessel per day was USD 20,585 for the period.

Profits for the period decreased by 76% to USD 6.8 million due to lower spot rates, renewal of contracts at lower rates and an increase in operating expenses.

For the third quarter of FY 2012, the company achieved revenue of USD 36.1 million and profit of USD 1.2 million. The total number of vessel operating days was at 1582 days as compared to 1521 days in the third quarter of FY 2011.

Due to immense oversupply of vessels, the Baltic Dry Index (BDI) continues to remain low. The average rate for Panamax 4 TC route for the first 9 months of 2011 has dropped to USD 13,700 per day as against USD 23,500 in the corresponding period previous year.

The downward trend in the freight rate has continued in beginning of calendar year 2012 and it has fallen further by a significant 47% to USD 6,800 levels. Any standstill in the current rates or further fall in spot rates will continue to negatively impact the Company‟s earnings from vessels exposed to the spot market. (Indonesia Today)

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