Well positioned for the market downturn but negatively impacted by the Covid-19 supply chain disruptions.
In the first half of 2020 Western Bulk posted a Net TC of USD 7.8 million and a loss after tax of USD -2.9 million.
With an overweight of cargo commitments and increased trading capabilities, the company was well positioned to benefit from the low market rates in the first quarter of the year. The second quarter the results were negatively impacted by Covid-19, combined with closed ports and a depressed market with rates down to levels not seen since early 2016. Port closures in South Africa and India in particular had a negative impact, as well as a low Atlantic market as vessels were kept in the region in anticipation of an improved market in the third quarter of 2020.
The Group is ahead of target of achieving USD 4 million in cost savings in 2020 compared to 2019. Administration expenses were reduced by USD 2.5 million in the first half of 2020, Net Finance was down by USD 0.8 million and insurance costs included in Net TC were reduced by 25 %, equaling USD 0.3 million in volume adjusted savings. Going forward management in particular sees potential in further reduction of costs included in the Net TC by optimizing vessel performance, time spent in port and purchases.
Building internal competence on the digital landscape is also a key focus area. The company continues to co-operate with CargoMetrics to develop trading signals and is also developing other decision support tools internally. For market intelligence, Western Bulk has joined the Oceanbolt data platform, and a new e-learning system has been implemented. The flexible IT infrastructure established over the last couple of years accommodated a seamless transition to home office during Covid-19.
“We are reasonably satisfied with the performance for the first half of the year taking seasonality and the Covid-19 supply chain disruptions into account. Western Bulk is now emerging as a more integrated and dynamic organization with focus on enhancing spot trading capabilities, improving decision support and excellence in vessel operations, states Hans Aasnæs, CEO of Western Bulk”.
An investor presentation will be held at or near the company’s premises at Henrik Ibsens gate 100 in Oslo on the 27th of August at 10:00 to 12:00. Pre-registration will be required due to Covid-19. To register please send an e-mail to IR@westernbulk.com.
Please see the link below for the First half year 2020 report for more information.
For more information, please contact:
Hans Aasnæs, Chief Executive Officer
Tel: +47 922 53 957