Scorpio Bulkers stock shot up in New York today after a better than expected first quarter report from the shipowner.
New York-listed Scorpio Bulkers jumped by more than one tenth after higher revenue and lower costs pushed its results beyond forecasts.
The Emanuele Lauro-led shipowner posted a $3.5m net loss for the first quarter versus a $5.8m red figure during the same period last year.
On an adjusted basis, the company posted a $4m profit for the three-month period.
Noah Parquette of JP Morgan said the company's operating loss per share of $0.17 was two cents ahead of the bank's and consensus projections.
Core operating profit of $15m edged ahead of the $13m forecast by JP Morgan as revenue was higher than projected, the analyst explained.
Scorpio Bulkers' shares have gained 11% to $5.26 in early-morning trading after release of earnings.
"The company has generally taken a batten down the hatches approach with the only capex for emission scrubbers, and we would expect commentary on the call to reflect that theme," Stifel analyst Ben Nolan wrote in a note to clients.
"In our view, the company is well positioned to weather the current dry bulk storm with IMO 2020 upside potential through their scrubber fitted fleet."
Investment gains and write-downs
Scorpio Bulkers saw a $15m non-cash gain in this year's first quarter on the October 2018 equity investment, through which it took 54.1 million, or 10.9%, of Scorpio Tankers shares.
That gain was offset, however, by a $7.5m write-down of two ships held for sale, the SBI Electra and the SBI Flamenco.
Vessel revenue totaled $50.4m compared to $54.3m a year earlier, driven by less activity during the first quarter in the Atlantic and Pacific.
Negative factors in these regions included lower industrial activity, higher natural gas consumption, mild temperatures and ongoing Chinese coal import restrictions from Australia.
In addition, ultramax and kamsarmax revenue was hurt by poor sentiment from "extreme disruptions" iron ore export capacity in Brazil and Australia.
