Algoma to exceed expectations in strong market
(Posted on 09/11/22)
Algoma Central Corporation has reported its results for the three and nine months ended September 30, 2022. Revenues increased 14% during the 2022 third quarter to $199,327 compared to $174,734 for the same period in 2021 while net earnings increased 6% in the same period. The Company reported 2022 third quarter EBITDA(1) of $73,604 compared to $69,415 for the same period in 2021. All amounts reported below are in thousands of Canadian dollars, except for per share data and where the context dictates otherwise.
"Our strategic approach to maintain disciplined growth and a strong vessel portfolio continues to serve us well," said Gregg Ruhl, President and CEO of Algoma. "Driving our plan forward are our hard working seafarers and shoreside support teams who continue to deliver exceptional service to our customers and long-term value for our shareholders. We had another busy quarter and I am pleased to see the significant recovery of our tanker business and continued strength in our international segments, particularly in our joint ventures. As we are well into the fourth quarter, I am confident Algoma will deliver full-year results beyond our earlier expectations as we expect steady market demand and strong operating performance across all business units to continue through to the end of the year," concluded Mr. Ruhl.
Financial Highlights: Third Quarter 2022 Compared to 2021
- Net earnings increased 6% to $42,533 compared to $39,984 last year. Basic earnings per share were $1.13 compared to $1.06.
- Global Short Sea Shipping segment equity earnings increased 60% to $12,103 compared to $7,541 for the prior year driven by increased earnings in the cement and handy-size fleets as well as significant freight rate increases in the mini-bulker fleet that nearly offset the reduced revenue from three less vessels in that fleet. Earnings for the quarter include a $2,922 gain on the sale of two vessels in 2022 compared to a gain of $2,720 on the sale of two vessels in the same quarter in 2021.
- Revenue for Product Tankers increased 55% to $32,749 compared to $21,186. This was mainly driven by higher fuel cost recoveries and improved customer demand. The increase was also attributable to the addition of one vessel to the fleet during the second quarter that operates internationally under bareboat charter. Despite higher operating costs, operating earnings increased 48% to $5,888 compared to $3,969 driven by a 32% increase in revenue days primarily due to the increased demand.
- Ocean Self-Unloader segment revenue increased 21% to $49,927 compared to $41,221 driven by higher freight rates, fuel cost recoveries and a 10% increase in Pool volumes. Operating earnings decreased 24% to $7,856 compared to $10,366 in 2021 due to higher operating costs and increased dry-dock expenditures.
- Domestic Dry-Bulk segment revenue increased 6% to $115,996 compared to $109,591, reflecting increased fuel recoveries and improved overall base freight rates. Despite lower revenue days during the 2022 third quarter, overall volumes were slightly higher offsetting the impact of lower vessel utilization on two vessels. Operating earnings decreased 7% to $30,453 compared to $32,795 driven primarily by higher layup and repair spending to activate idled vessels in preparation for the fall grain harvest in Canada.
2022 Business Outlook(2)
Domestic dry-bulk cargo volumes are expected to be strong across all commodities, driving full fleet utilization for the balance of the year. The Western Canada grain crop size has returned to trend line level which, combined with continued demand for Eastern export capacity due to the Ukraine conflict, has allowed any open capacity to be filled at prices reflecting the strong market conditions. Product Tanker demand is expected to remain steady and we expect the fleet will continue to be well utilized in the fourth quarter.
Customer demand and vessel supply for the Ocean segment is fairly well balanced for the remainder of the year. Aggregate volumes are expected to be impacted by a facility closure in Mexico and the US residential market is expected to slow down but overall construction sector demand remains strong as infrastructure investments are picking up. We are expecting costs to continue to be impacted by inflation and global fuel prices will likely remain higher than normal.
Latest News
INTERCARGO report: Safety gains continue but security threats emerge
(Posted on 15/06/25)INTERCARGO, the International Association of Dry Cargo Shipowners, reports encouraging progress in bulk... Read more
Marcura and Sedna Partner to simplify maritime workflows
(Posted on 15/06/25)Marcura and Dataloy Systems have announced a new phase in their long-standing strategic partnership... Read more
Ageing fleet drives surge in number of maritime incidents, says DNV report
(Posted on 06/06/25)According to DNV’s latest report, Maritime Safety Trends 2014-2024 - Preparing for future risks... Read more
Two Damen Combi Freighters 3850 launched for Fast Lines Belgium
(Posted on 06/06/25)The second of three Damen Combi Freighters (CF) 3850 has been launched in China for Fast Lines Belgium... Read more
Columbia: Diversity’s ‘forgotten twin’ inclusion must be priority
(Posted on 06/06/25)Inclusion is every bit as important as diversity in ensuring that shipping becomes a truly welcoming... Read more
Postfix for shipbrokers made simple
(Posted on 02/06/25)AXSMarine, a pioneer and market leader in the provision of advanced solutions and market intelligence... Read more
Veson Nautical and Great Eastern Shipping go live with IMOS Platform
(Posted on 30/05/25)Veson Nautical, a global leader in maritime data and freight management solutions, and The Great Eastern... Read more
Columbia Group welcomes alignment on ETS
(Posted on 30/05/25)Columbia Group has welcomed the UK government’s announcement to link its emission trading system... Read more
Damen completes green retrofit project for BAM Shipping
(Posted on 15/05/25)Damen Shipyards Group, together with partners including Atal Solutions has completed its retrofit of... Read more
NORDEN expands MPP fleet, reinforcing growth in Projects & Parcelling
(Posted on 15/05/25)NORDEN has announced that it has signed agreements for two additional 17,500 dwt Multi-purpose (MPP)... Read more
