Rising bunker prices and low shipping rates negatively impacted Wallenius Wilhelmsen’s earnings in the third quarter.
The Norwegian shipping group reported Friday a total income of US$1 billion in the third quarter, up 7% compared to 2017. The company said the increase was primarily due to increased revenues in both its land-based and ocean segments, driven by a combination of slightly higher volumes and higher bunker fuel costs paid for by customers.
EBITDA ended at US$152 million in the quarter, a decline of 19% compared to the third quarter last year, which was largely driven by higher and rising bunker prices in the ocean segment, lower rates, and trade imbalances with more volumes out of Asia than Europe, the company said.
“Results for the third quarter were in line with our expectations,” said says Craig Jasienski, President and CEO of Wallenius Wilhelmsen. “We see volume development leveling out and the underlying performance is hampered by rising bunker prices and low rates. We have delivered on the USD 120 million synergy target and are now moving to the next phase of improvement initiatives. During the quarter we initiated a performance improvement program targeting USD 100 million in bottom line improvement to further increase operational efficiency, reduce costs and lift margins.”
Wallenius Wilhelmsen, headquarters in Oslo, Norway, is a market leader in global Ro-Ro shipping and vehicle logistics. The company operates around 130 vessels, 13 marine terminals, and 77 processing centers part of as a global inland distribution network.