Feedership specialist MPC Container Ships (MPCC) is projecting a lower result this year due to the sharp downturn in charter rates.
The Oslo-listed ship tonnage provider expects Ebitda of $420m to $450m this year, down from the record $522.7m in 2022.
Operating revenues are projected in the range of $610m to $630m, which is roughly in line with last year’s figure of $616.8m.
The forecast includes profits from deals relating to three feeder vessels.
In December and January, the company sold the 2,742-teu AS Cleopatra (built 2006) and 2,824-teu AS Carinthia (built 2003), and agreed the early redelivery of the 2,742-teu AS Carlotta (built 2006).
The fresh guidance comes after what chief executive Constantin Baack said was the “best financial year in MPCC’s history”, in which profits more than doubled to $435m in 2022.
Profit dropped to $103.6m in the fourth quarter from $127.9m a year earlier, despite a 14% rise in operating revenues to $162.1m.
But profit in the fourth quarter of 2021 included several vessel sales, which increased the bottom line significantly.
Normalised profits for the fourth quarter — excluding vessel sales — rose 59% to $91m from $57.5m.
“This past year has brought a variety of challenges and opportunities, including a period with the highest charter rates in the history of container shipping, as well as a rapid decline in freight and charter rates throughout the second half of the year,” Baack said.
“During the first half of 2022, we were able to capitalise on the strong markets by locking in long-term time charter contracts at very attractive rates.”
The company ended the year with contract coverage for 86% of operating days in 2023 and a charter backlog of $1.5bn.
It has deleveraged and currently operates with a low leverage ratio of 16.1%.
Optimism
Baack remains bullish on the prospect for the container market, as vessel availability is significantly reduced compared with historical averages.
“General improvements in the outlook for the global economy over recent months give reason for optimism in the medium-term outlook for container markets, in particular for intra-regional trades, for which the supply-demand balance appears considerably more encouraging than for the long-haul market,” he said.
“With industry-low leverage and a robust charter backlog providing high earnings visibility for the coming year and beyond, MPCC remains in a very strong competitive position.
“In 2023, we will utilise our agile business model and financial flexibility to seize opportunities as they arise and will continue our focus on continuous fleet optimisation while remaining highly committed to our policy for returning capital to our shareholders.”
