UK-based bulker owner Anglo International Shipping filed weaker results for last year on the back of lower revenue and rising costs and is positioning itself for stronger freight markets in 2024.
Anglo’s bulker fleet remained static at eight vessels during 2023, comprising six post-panamaxes and two kamsarmaxes.
Net profit shrank to $5.3m last year from $28.3m the previous year. Revenue fell by 28% year on year to $51.1m, due to comparably weaker freight markets.
Anglo began its financial year with about 50% of vessel days already covered by a mixture of fixed-rate and index-linked charters. The shipowner said that will change this year.
“The strength of the group’s balance sheet and completion of fleet capex [capital expenditure] programme until the second half of 2025 has enabled the group to pivot the commercial employment strategy to reduce the percentage of locked-in revenues from fixed-rate time-charters,” Anglo said in its report.
“An increase in index-linked time-charters in 2023 and 2024 is intended to improve exposure to further improvement in the dry bulk market while downside risks remain well mitigated.”
The net result was hit by a 12% increase in the company’s cash breakeven rate during 2023, which was $12,589 per day last year.
The rise came on the back of one-off vessel operating costs from unbudgeted repairs and maintenance, plus a transfer of ship management services to a different provider.
Finance costs rose almost 30% year on year as interest rates soared.
The current price differential between low-sulphur and high-sulphur fuels “contributed meaningfully” to group revenue and earnings during 2023 and is expected to continue to do so, the company added in its report.
There were smaller dividends paid out to Anglo’s equity holders, which include company directors Darren Maupin, who is manager of equity fund Pilgrim Global, and Star Capital Partners fund manager Anthony Mallin.
Anglo paid a dividend of $1.79 per share for the whole year, against $3.55 per share for 2022.
Meanwhile, the shipowner appears to have changed its mind on the possibility of acquiring more vessels.
Its 2022 report said the company saw potential for acquisitions at good prices and returns, subject to raising additional capital, but there was no such statement in its report for last year.
“The market value of the fleet fell slightly during the year but remains comfortably above book value,” Anglo said in its report, for the second year in a row.
Maupin and Mallin co-founded Anglo because there were no suitable publicly listed vehicles for investments in panamax bulk carriers and larger tonnage.
Pilgrim Global started its shipping investment campaign in 2016, when it was involved in the recapitalisation of Genco Shipping & Trading.
Since then, the fund has bought into Eagle Bulk Shipping and Maupin was a driving force behind setting up MPC Container Ships.
Pilgrim became one of the biggest shareholders in Navios Maritime in January.
The fund was started by Fidelity Investments veteran Maupin in 2011 with $10m.
