PHILIPPINE cargo carrier Lorenzo Shipping Corp (LSC) expects to post higher income this year despite continuing volatility in the world economy due to crises in the Euro zone and the Middle East.
LSC projects an income of P70 million in 2012 from the previous year’s P11.17 million, the lowest in three years. For 2010, the income was P52.09 million.
For the first quarter of the year, the company posted a net income of P15.92 million from P18.71 million in the same period last year as a result of higher general and administrative expenses.
Total revenues grew to P455.06 million from P388.36 million.
“It was an odd year for us in 2011 because we had to recognize some P24 million worth of doubtful accounts” that had to be written off, LSC president Roberto Umali said at the sidelines of the stockholders’ meeting last week.
“The doubtful accounts accumulated over the years, which may include disputed charges that customers didn’t want to pay.”
With its newer fleet, Umali said the company was in much better shape today to increase profit than it was six years ago, or before the Magsaysay Group bought a chunk of the firm.
He said the company has maintained the same number of ships over the last few years (seven), but that all were newer and more cost-efficient models. Three — Lorcon Manila, Lorcon Dumaguete and Lorcon General Santos — were bought in the last two years.
“Over the last six years, we have also acquired 3,614 new containers through a combination of straight lease and lease purchase arrangements. These enabled us to dispose of and or off-hire 2,519 old containers, 80% or 2,021 units of which are 20 years old and above,” Umali said.
He added the company, which has an 11% market share, plans to launch a Visayas-Mindanao service in the third quarter of the year.
“Domestic shipping is beset with overcapacity but we are confident that the best-run company will survive and grow. Despite challenges in the industry, we see opportunities. We remain bullish about the future,” Umali said.
LSC owns and operates a fleet of seven vessels deployed to the key ports in Manila, Visayas and Mindanao. Vessels have a capacity ranging from 200 twenty-foot equivalent units to 426 TEUs with speeds of 11 knots to 15 knots.
Photo from www.lorenzoshipping.com/news
