Western Bulk Chartering has had its best start to the year since it was founded in 1982, but expects demand for dry-cargo shipping to suffer during the rest of this year.
The Oslo-listed bulker operator recorded $37.4m in net profit after tax for the first half of 2022, more than four times the $9m it booked during the same period in 2021.
“The high market volatility seen in 2021 continued into 2022. With focus on trading the short-term market, Western Bulk managed to utilise this both in respect of total market levels and relative levels between the basins,” the firm said in its financial report for the period.
“The company has also managed to limit negative impacts from the Russian invasion of Ukraine.”
Western Bulk has declared a dividend of $13m for the second quarter, which is NOK 3.85 per share ($0.40).
The company has implemented a quarterly dividend policy to distribute a minimum of 80% of its earnings.
Gross revenues during the first six months of 2022 were $883.1m, compared to $565.3m in the same period in the previous year.
Western Bulk attributed its good results to “good craftmanship with an agile approach to market volatility” and strategic and operational initiatives that have borne fruit.
“In addition, cooperation between regions has been strengthened to improve decision making, as well as to capture a larger arbitrage potential from higher dry bulk market volatility,” it said in its report.
The firm said it has been making investments to allow for more data-driven decision-making in developing a more “systematic approach” to business development and managing client relationships.
Western Bulk ran an average fleet of 113 supramax, ultramax and handysize bulk carriers in the first half of 2022.
Its net time-charter (TC) margin per ship was $3,158 per day during the six-month period, compared to $1,020 per day for first half of 2021.
The firm said there was a “significant increase” in the size of its fleet during the second quarter, during which it operated 120 vessels on average, up from 105 in the first three months of the year.
Looking ahead, Western Bulk said it does not expect seasonally higher markets in the the second half of the year than in the first, as would usually be the case.
“This is not expected to happen this year due to lower economic growth with the risk of several countries going into recession,” the firm said in its report.
“Uncertainty related to Chinese demand is increased, spurred by troubles in the housing sector, as well as increased tension between China and the US regarding Taiwan adding to the negative sentiment.
“The Baltic Supramax Index has been declining for all forward periods throughout the summer, and with muted market levels overall volatility is expected to be lower.”
Western Bulk opened an office in Dubai early this year. Some employees from the company's Indian Ocean commercial team have relocated from Singapore to Dubai to get closer to customers in the Middle East.
The company listed on Oslo’s Euronext Growth exchange in September last year.
Its shares have been registered on Oslo’s over-the-counter market for unlisted securities since 2017
Its predecessor company, which had the same name before becoming Bulk Invest, was listed on the Oslo Stock Exchange from 2013 to 2016.
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