Philippine listed domestic carrier Lorenzo Shipping Corp. (LSC) reported a net loss of P164.54 million for the third quarter of the year from only P348,397 in 2014, a whopping 47,128% difference.
This brought net loss in the first nine months to P182.813 million from a net income of P9.156 million in the same period of the preceding year due to prolonged drydocking of vessels and a generally weak market.
Revenues for the nine-month period declined 4% to P1.665 billion from P1.730 billion in 2014, LSC said in a disclosure to the Philippine Stock Exchange.
The domestic carrier sustained an 8% decline in cargo volume for the first nine months of the year, handling 57,096 twenty-foot equivalent units (TEUs) from 62,098 TEUs in the same period last year. Total voyages reached 16 versus 14 in 2014.
The company targets a volume of 90,000 TEUs for 2015, up 5.2% from the 85,521 TEUs handled in 2014.
“Prolonged dry docking days and emergency repairs of the vessels weighed down on the current operations,” LSC explained, adding this was coupled with weak market until the middle of the third quarter.
The company resorted to co-loading cargoes with other shipping lines while addressing reliability issues of its vessels. Co-loading costs during the period amounted to P129 million, almost two-folds higher versus P48 million in the previous year.
Likewise, “trucking costs surged by 43% from P248 million in 2014 to P355 million in 2015 due to port congestion,” LSC added.
The firm incurred a loss of P57 million in the disposal of its vessel MV Lorcon Cebu during the year.
It has allotted P600 million for capital expenditure this year to be invested in land-based equipment and facility as well as in the dry-docking of vessels.
LSC president Roberto Umali said competition remains tough in the domestic shipping industry and it is a “challenge for us to protect our existing 10% market share.”
