Maybulk eyes more second-hand vessels.
Malaysian Bulk Carriers Bhd (Maybulk) plans to grow its fleet this year via the acquisition of modern second-hand vessels as their prices are still competitive on the back of the strengthening market. Chief executive officer Kuok Khoon Kuan said the timing was right to grow Maybulk"s fleet this year as second-hand vessel prices were still 60% to 70% cheaper than their peak in 2008.
?As a comparison, we sold four vessels for RM327.3mil in 2008 while the one vessel that we sold last year only reached RM8mil.
?We are looking at second-hand and modern vessels in the handy-size category. But, we have not decided on the number of vessels to be acquired as it will depend on the price, market and conditions of the assets,? he told reporters after the company"s financial result briefing yesterday.
Last year, Maybulk bought two second-hand vessels of 22,000 deadweight tonnes (dwt) and 55,000 dwt. Currently, it owns 10 dry bulk vessels, three product carriers plus another two charter-in vessels.
Furthermore, Kuok said, the plan to acquire the vessels was in line with the stabilising market, although future volatility could not be completely ruled out.
?We do not want to invest in new buildings as currently they are still relatively expensive despite overcapacity,? he said, adding that the acquisition plan, reduced cash and its equivalent as well as banks" cautious stance on the shipping industry were the underlying reasons for the reduced dividend last year.
Maybulk recommended a single-tier dividend of 15 sen per share for the financial year ended Dec 31 (FY09) against 30 sen in FY08.
The company"s cash and cash equivalent stood at RM460.4mil in FY09 against RM805.6mil in FY08.
However, Maybulk recorded a significant jump in net profit for the fourth quarter ended Dec 31 to RM88.4mil compared with RM3.2mil in the previous corresponding quarter due to improvement in the group"s quoted investments and higher contributions from associate companies.
Revenue for the period under review was RM82.6mil compared with RM138.1mil previously.
For the full year, Maybulk"s net profit of RM243.8mil was almost slashed by half compared with RM460.9mil in FY08. Revenue for the group dropped 58% to RM303.7mil.
The factors affecting the group"s earnings were the state of the charter market and reduced fleet size.
According to Kenanga Research in it result note, Maybulk"s core net profit was RM170.2mil last year (excluding RM65.6mil forex/investment gains and RM8mil gain from disposal).
The Baltic Dry Index (BDI) was volatile throughout last year, starting at 773 points and then peaking twice on June 3 at 4,291 points and Nov 19 at 4661 points. At the close of the year, the BDI dropped to 3,005 points.
All this translated into lower comparative average time charter equivalent for the drybulk fleet of US$19,076 per day in 2009 versus 2008"s time charter average of US$37,953 per day.