Singapore’s Grindrod Shipping has booked a second-quarter net income of $53.3m in what it describes another record quarterly performance that reflects the resilient markets in the handysize and to ultramax bulk carrier segments.
Combined with its first quarter earnings, Grindrod has earned a net profit of $83.1m on revenue of $271.9m during the first half of its 2022 financial year.
Stephen Griffiths, Grindrod’s interim chief executive officer and chief financial officer said the dry bulk market remained healthy in the second quarter of 2022, despite the ongoing Russian-Ukraine conflict and disruptions in traditional trade routes.
“The smaller segments in which we operate are still earning a premium over the larger vessels due to their versatility, benefiting from a broader base of cargoes and continued spillover from the container trade,” Griffiths said.
“The supply picture remains at very healthy levels with continued minimal ordering of new vessels due to concerns over environmental regulations and higher newbuilding prices.
“As we head into the second half of the year, more macroeconomic concerns have emerged as the global economy grapples with elevated inflation levels and rising interest rates. Thus far the impact on the dry cargo market has been minimal, though we remain prudent in our approach to risk management given the potential uncertainty.”
Grindrod said that as of 10 August, vessel employment contracted for the third quarter included approximately 1,020 operating days in the handysize segment at an average time charter equivalent (TCE) per day of approximately $25,127, and approximately 1,524 operating days at an average TCE per day of approximately $26,766 in the supramax and ultramax segments.
During its second quarter Grindrod exited the tanker sector, selling the 50,100-gt MR2 product tanker Matuku (built 2016) to Premuda for $30m. It exercised the purchase option it held on the chartered 57,800-dwt bulk carrier IVS Pinehurst (built 2015) for $18m and extend the long-term charter of the 57,900-dwt bulk carrier IVS Crimson Creek (built 2014) for a period of 11 to 13 months at a rate of $26,276 per day commencing 1 May.
The company’s Board of Directors have declared an interim quarterly cash dividend of $0.84 per ordinary share, its highest quarterly dividend to date, payable on or about 19 September to all shareholders of record as of 9 September.
Griffiths described the dividend as continuing Grindrod’s “flexible capital return policy of rewarding our shareholders with material dividends in times of market strength”.
Grindrod is listed on the Nasdaq and Johannesburg exchanges.
