Independent container owner MPC Container Ships ASA (hereinafter referred to as "MPCC" or the company) on May 23, 2023 first quarter unaudited financial results.
the first quarter of 2023, MPCC achieved operating income of US $0.18 billion, up 26.0 per cent year-on-year and 11.1 per cent month-on-month. Gross profit reached US $0.14 billion, up 17.7 per cent year-on-year and 9.0 per cent month-on-month. Earnings before interest, tax, depreciation and amortisation (EBITDA) reached US $0.14 billion, up 2.7 per cent year-on-year and 11.4 per cent month, the month-on-month increase was 14.0 per cent; net profit before tax was $0.12 billion billion, up 2.4 per cent year-on-year and 14.8 per cent month-on-month; net profit reached $0.12 billion or $0.27 per share, up 2.5 per cent year-on-year and 15.5 per cent month-on-month.
In the first quarter of 2023, the MPCC fleet's average daily TCE reached $30989, up 24.7 percent year-on-year and down 0.9 percent month-on-month; average daily management costs per ship were $6397, up 1.7 percent year-on-year and down 7.8 percent month-on-month. The fleet-in-flight rate reached 97.1 per cent, down slightly from a year earlier from 98.8 per cent.
MPCC CEO Constantin Baack said it was pleased to report another strong quarter, with strong earnings and continued high fleet utilisation despite ongoing macro and geopolitical uncertainty. This was driven by solid charter parties and continued strong operational performance. As of the end of the first quarter, lease coverage reached 89% in MPCC2023 and 58% in 2024, respectively, which provides MPCC with visibility into cash flow and dividend capacity in the coming years. In 2023, the accumulated rental reserve under the charter party reached 1.3 billion US dollars.
after a sharp market normalisation in the second half of 2022 and early 2023, the containership chartering market is now showing signs of stabilising and rental rates are well above historical averages. The current stabilization of rentals will be constrained by the availability of vessels for charter, such as reduced speed sailing. For regional routes in particular, the supply-demand balance for feeder vessels is more encouraging than for larger vessels, with demand outpacing capacity growth and supported by reasonable ship dismantling. Nevertheless, it remains to be seen how the supply growth of large ships will affect the overall container market in the future.
2023 performance expectations
MPCC management maintains its 2023 performance forecast and expects its full-year operating income to reach 6.1-0.63 billion US dollars and EBITDA to reach 4.2-0.45 billion US dollars, including the expected proceeds from the announced sale of "AS Cleopatra" and "AS Carintia" in December 2022 and January 2023, and the "AS Carlotta" early repayment settlement received in January 2023.
Specifically, the MPCC and its joint venture partners have agreed to sell the "AS Carintia" wheel (built in 2003, 2800 TEU) for $7.6 million. In addition, MPCC also announced the acquisition of "RIO CENTAURUS" (built in 2010, 3400TEU) and "TRF KAYA" (built in 2007, 2800TEU) for US $33.9 million. Both ships are equipped with desulfurization towers and come with leases that will expire in the fourth quarter of 2023 and the first quarter of 2024.
As of now, MPCC owns and operates 62 container ships with a total capacity of 134,700 EU. In addition, the MPCC also holds orders for four new ships, all of which have charter parties attached to them. Two new shipbuilding orders for 5550TEU ships, each costing $72.2 million, are expected to be delivered in the first quarter of 2024. In July 2022, MPCC spent US $78 million to order two methanol-powered 1300TEU container ships in Sanfu, Taizhou, which are expected to be delivered in the third and fourth quarters of 2024.
Constantin Baack concluded that based on the high visibility of contractual cash flows and a robust and flexible balance sheet, MPCC is ideally positioned to continue to create value and remain committed to its policy of returning capital to shareholders. In the first quarter of this year, MPCC will take advantage of flexible business models and financial flexibility, and will continue to focus on continuous fleet optimization. Going forward, the MPCC will continue its efforts and will remain focused on the ongoing optimization of its fleet to achieve the best interests of its shareholders and promote the decarbonization of the industry. "
Source: Shipping Industry