Norden is still on track to hit its bottom line target despite lower bulker rates and higher product tanker costs.
The Copenhagen owner-operator narrowed its full-year profit guidance to between $360m and $420m — from a range of $330m to $430m — on the back of its assets and logistics business.
It reported a $108m profit for the second quarter, down from $179m year over year.
“A dedicated focus on customer freight services in volatile markets ensured profitable margins across both dry cargo and tankers, despite weaker market sentiment,” chief executive Jan Rindbo said.
“In addition, we have delivered high cover earnings and vessel sales gains through active management of our portfolio.”
For the three months ending 30 June, Norden’s freight services and trading segment saw its profit fall to $34m from $153m in the same period last year due to the weaker dry bulk market and rising tanker costs.
The company said it was able to cash in on the solid tanker market by moving ships into the Pacific basin at premium rates and inking profitable medium-term time-charter deals.
On the dry bulk side, it said it kept a short position during the quarter, helping it to maintain profitability.
The assets and logistics segment helped to offset the losses from the freight services and trading side, as its bottom line jumped to $74m from $26m with high coverage on both the dry bulk and tanker side.
Norden said that segment is expected to weaken in the second half of the year, but it is still on track to best 2022’s $193m profit.
Returning capital
The company said it would pay a dividend of DKK 10 ($1.48) per share for the quarter — a total of DKK 340m.
It is also launching a $30m share buyback programme, allowing it to repurchase as many as 1.2m shares.
Norden said the goal was to adjust its capital structure to hedge its obligations under incentive plans granting options to employees.
In early trading in Denmark, Norden’s Nasdaq Copenhagen-listed shares slipped DKK 3.20 — or just under 1% — to DKK 335.40.
