Pacific Basin Shipping profits softened in the first half of this year as margins on its operated fleet fell.
The Hong Kong-listed company reported a net profit before tax of $57.6m for the six months, down from $85.3m a year earlier.
Chief executive Martin Fruergaard noted that Pacific Basin’s fleet had outperformed the Baltic Exchange indices for handysizes and supramaxes, but said operating bulkers is expensive at the moment.
“Our operating activity saw significant growth in vessel numbers and operating days, although at a substantially lower margin per day,” he said in the financial report.
“Our outperformance was impacted by the increased cost of chartering short-term core vessels, required as a result of our high near-term cargo coverage.”
The operated fleet, which includes 154 chartered-in bulkers, earned an average profit margin of $550 per day over 14,210 operating days in the first half, compared with $1,550 per day in profit a year earlier.
Its handysize bulkers earned an average time charter equivalent rate of $11,810 per day, down 9% year on year.
Its supramaxes earned an average TCE of $13,690 per day in the first half, in line with last year.
Pacific Basin’s operated fleet numbered 286 vessels in the second quarter, down from 302 in the first quarter. Of these, it owns 131 handysize and supramax bulkers.
Fruergaard said bulker markets continue to be disrupted, which is helping absorb tonnage supply.
“Year to date, we have seen a notable reduction in seasonality as a result of tonnage imbalances between the Atlantic and Pacific regions due to fleet inefficiencies caused by disruptions in the Suez and Panama canals,” he said.
“Despite concerns about global economic growth, elevated interest rates, ongoing conflicts in Ukraine and Palestine, and the negative impact of reduced housing construction in China, total dry bulk demand still rose over the period, which is positive for the long-term outlook.”
Pacific Basin has booked 7% of its handysizes at $9,670 per day during the first half of 2025 and 19% of its supramax days at $13,370 per day.
The board has declared a dividend of HKD 4.1 ($0.53) per share for the first half.
Pacific Basin has a $40m share buyback programme that expires at the end of this year.
