UK shipbroker Braemar has doubled its interim profit on the back of busy sale and purchase (S&P) markets and tanker fixture strength.
The London-listed company said it had continued to benefit from the increased scale and breadth of its broking operations, with activity "significantly up".
In the six months to 31 August, net earnings were £8.6m ($10.1m), up from £4.3m a year ago.
This was “materially ahead” of expectations at the start of the year.
There was a 46% increase in revenue to £69.4m.
Net cash stood at £1.8m, against net bank debt of £9.3m at 28 February.
The dividend will be four pence per share “to reflect strong cashflow and confidence in the business,” Braemar said.
The outlook is very positive, the company added.
“We are well set up for continued investment to deliver growth throughout the business cycle,” the London shop said.
Revenue has risen in S&P and on all chartering desks.
More fixtures
It has been particularly strong in deep sea and specialised tankers, and dry cargo.
Fixture volumes increased by 7% for deep sea tankers and by 47% for the specialised desk.
Total revenue for S&P was £13.5m, up 36% from last year.
“Deal flow continues to be strong on the back of asset plays, fleet renewal considerations, and other individual shipowner strategies,” the brokerage said.
“Buyers are slowly adjusting to the new pricing norms, and for newbuildings the biggest issue going forward is finding the right berth space,” it added.
The desk is receiving strong enquiries from the LNG, car carrier, multipurpose and heavy lift sectors, with “positive sentiment growing” in the crude and chemical tanker sectors.
Tanker prospects continue to be favourable and rates are expected to “remain consistent” over the coming months, the broker said.
New bulk entrants
For bulkers, the client base has grown slightly as several new companies pushed into bulk trades rather than containers.
“There is a limited newbuilding orderbook, especially in the handysize fleet, and consequently the market looks positive over the next two to three years,” Braemar said.
Chief executive James Gundy added: “It’s clear that we’ve unlocked great potential through our growth strategy, [and] are delivering the performance that I promised our shareholders on my appointment in January 2021.”
He added the group is “well on track to double our profits by 2024. Our growing scale and sectoral diversification means we are also set for strong performance throughout the business cycle”.
Chairman Nigel Payne said: “With 14 offices across the globe, operating in 11 countries and covering all of the major shipping markets, the business is lean, focused, well-insulated from market movements in any one specific market sector, geography, or economy, and is starting to benefit from the operational gearing from its growing scale.”
