Saturday 24 August 2019

Clarkson profits fall as shipping firm warns tough market conditions to continue

Pre-tax profit declined to £42.9m last year from £45.4m.

Shipping giant Clarkson has reported lower annual profits (Andrew Matthews/PA)
Shipping giant Clarkson has reported lower annual profits (Andrew Matthews/PA)

By Maryam Cockar, Press Association City Reporter

Shipping giant Clarkson has reported lower annual profits and warned that trade wars and Brexit are continuing to hit global sentiment.

The FTSE 250-listed company said geo-political uncertainty from the US-China trade dispute, Britain’s impending departure from the European Union affecting foreign exchange rates, and sanctions are all having an impact worldwide, which is delaying Clarkson’s ability to “execute on awarded mandates”.

However, chief executive Andi Case expects the current headwinds to diminish as the year progresses.

We believe that the strength and breadth of Clarkson, enhanced by technology platforms which continue to be rolled out to our clients, positions the group well for the future Clarkson CEO Andi Case

He said: “Geo-political uncertainty and natural disasters are currently affecting global sentiment and exchange rates, which in part offsets the better visibility from an improved forward order book.

“These headwinds are having an impact, in particular within our financial segment, but, as the year progresses, we expect these to diminish and the impact from changes in regulation around sulphur emissions to begin.

“Consequently, we believe that the strength and breadth of Clarkson, enhanced by technology platforms which continue to be rolled out to our clients, positions the group well for the future. The board remains confident about the longer-term outlook for Clarkson.”

Shares in Clarkson declined by 6.4% to 2,425p in early trade.

Pre-tax fell to £42.9 million in 2018 from £45.4 million the year earlier after the company booked higher costs as it invested in its digital capabilities.

However, revenue increased to £337.6 million from £324 million, led by its ship brokering division.

The group’s forward order book for 2019 stands at 107 million US dollars (£82.4 million), a 15% increase from last year.

Mr Case said “despite a challenging start to 2018” the company delivered a “robust financial performance in line with expectations, strengthening our position at the forefront of the market and generating further returns for our shareholders”.

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