Shares in Stolt-Nielsen were on the slide in Oslo this morning after the chemical tanker giant posted a weaker than forecast second-quarter performance.
Stolt-Nielsen posted big year-on-year gains after its bottom line was boosted by the end of a years-long battle over a shipboard explosion and the ongoing Red Sea crisis.
However, its results lagged market expectations with its bottom line weaker than analysts had anticipated.
In early trading in Oslo, Stolt-Nielsen shares took a beating, falling NOK 11 ($1.03) to NOK 452 from the open and were down NOK 22.50 from Wednesday’s close.
The company said on Thursday morning that it brought in $137m in operating profit, up from $10.1m a year ago.
This was below the $139m consensus among analysts, with net profit of $89.7m also missing the $104.5m forecast by analysts, according to data from Norne Securities.
Last year, Stolt-Nielsen’s second-quarter showing was held down by a $155m loss provision for a fatal explosion aboard the 6,732-teu MSC Flaminia (built 2001).
But the two companies settled in May after litigation in multiple US jurisdictions and more than 1,000 court filings, taking the loss provision off the table.
For its tanker segment — the world’s largest chemical tanker fleet — Stolt-Niselsen reported $465m in revenue and $107m in operating profit.
The company attributed the spike to higher freight rates as ships avoided the Red Sea and Suez Canal.
It said its Stolt NYK Asia Pacific Services (SNAPS/ENEOS) pool, including ships from Eneos Ocean, helped boost the top line by $32.9m. The pool was established last winter.
Chief executive Udo Lange said in a statement: “Stolt Tankers had another strong quarter, buoyed by higher spot freight rates due to the ongoing transit restrictions in the Red Sea, resulting in record high average [time charter equivalent] earnings of $32,862 [per day].”
Stolt-Nielsen’s terminals business was largely flat, bringing in $28.2m in operating profit versus $28.5m for the same period last year. Its tank container segment booked $12.5m against $13.3m in the same time period.
Stolt-Nielsen had been locked in litigation with MSC Mediterranean Shipping Company for more than a decade, stemming from an explosion aboard the MSC Flaminia that killed three crew members.
In 2018, a judge found the company 45% liable for the deadly blast with the remainder going to a Louisiana company that loaded chemicals onto one of Stolt-Nielsen’s tank containers.
After more than 1,800 court filings, the sides filed papers saying they settled the matter, with the tanker giant paying out $290m in May.
With the matter settled, the company took the $155m loss provision off its books.
