Pacific Shipping Trust (PST) has reported a 20 per cent year-on-year fall in net profit to US$6.7 million for its second quarter ended June 30, 2009.
Pacific Shipping Trust (PST) has reported a 20 per cent year-on-year fall in net profit to US$6.7 million for its second quarter ended June 30, 2009 despite a 54 per cent increase in gross revenue to US$15.5 million. As gross revenue was driven by contributions from new vessels, higher operating costs in the form of management fees and fleet management expenses took their toll on the bottom line. Quarter on quarter, net profit and gross revenue grew slightly from the US$6.6 million and US$15.2 million recorded previously.
For the six months ended June 30, gross revenue spiked 63 per cent year on year, from US$18.9 million to US$30.7 million. Net profit rose 51 per cent, from US$8.8 million to US$13.3 million. Q2 distribution per unit was 90 per cent of distributable income at 0.99 US cents - 0.01 US cents higher than in Q1. But PST said yesterday it will be revising its distribution policy to retain more cash to meet 'contingent needs' amid the weak global economy. 'It is anticipated that distribution for the quarter ending Sept 30, 2009 will not be less than 70 per cent of distributable income,' the group said in a statement. PST's decision to review distribution payout ratios follows First Ship Leave Trust's (FSLT) decision to do so on Tuesday. FSLT decided to cut distribution per unit from Q3, to repay more of its debt faster.
PST has no medium-term debt obligations - its entire fleet is financed by long-term debt. For Q2, the group's earnings per unit came in at 1.13 US cents, compared with 2.48 US cents a year earlier. Earnings per unit for H1 2009 were 2.25 US cents, against 2.62 US cents a year earlier.
The group has a sombre view of the industry going forward.
'End-demand for consumer products, especially in the US and Europe, has not picked up, which translates to continued uncertainty in terms of demand for freight services and freight rates,' it said.