Shipbroking giant Clarksons has an eye on acquisitions after adding to its sizeable cash pile in the first half of this year, its chief executive says.
The world’s largest shipbroker has set record profits for the last three years and logged a strong opening six months to 2024 in results released to the London Stock Exchange on Monday.
Clarksons finished the first half with free cash of £178.4m, a period that saw profit hit £51.5m ($60.07m).
Andi Case, chief executive of Clarksons, told TradeWinds: “Obviously we’ve discussed capital deployment on a regular basis, but we have been looking at acquisitions as you’re well aware of, you’ve written about, sometimes they’re executable, sometimes they’re not.”
He added: “But that’s why we’ve been hiring people as a consequence. And we have been doing some bite-sized acquisitions throughout the term as well. We’re very much still looking at situations and opportunities, but we’re going to stick to our discipline as well.”
While Case did not mention any specific discussions, last year TradeWinds reported that Clarksons was in talks to buy Maersk Broker, prior to the Danish company completing a management buyout over Christmas.
Clarksons said on Monday it had made a significant investment in new hires to further enhance market-leading teams, expand products and strengthen its global presence.
Jeff Woyda, chief financial officer and chief operating officer at Clarksons, said all stakeholders were comfortable with the company’s cash position, particularly given the “very complex world” with a high degree of volatility.
He said investors were content as the strong balance sheet allowed the company to handle whatever the world throws its way. At the same time, staff knew bonuses could be paid, while employees and clients alike knew the cash allowed for investment in the business.
“So all stakeholders are comfortable with the fact that we have a strong balance sheet, which secures us and secures our ability to continue to grow and push forward,” he told TradeWinds.
“The goal of where we are with our strong balance sheet is to enable us to be nimble and quick and enable us to be strong right the way across the board.”
Clarksons’ first-half profit was down fractionally from the £53.1m booked at the same stage 12 months ago.
Gerald Khoo, an analyst at Panmure Liberum, Clarksons’ in-house broker, said Clarksons’ results were in line with its forecasts. The “modest decline in profits was against the tough comparative of a record” first half of last year.
“The slight drop in profits year on year was as anticipated,” he added.
Clarksons said its shipbroking division, the largest contributor to its profitability, saw profit hit £53.4m with revenue coming in at £247.7m. This time last year shipbroking profit sat at £58.2m on revenue of £257.2m.
Deutsche Bank analysts led by James Beard said the results were solid against a generally healthy market backdrop.
