Philippine domestic carrier Lorenzo Shipping Corporation (LSC) reported a higher net loss of P188.9 million in the first nine months of 2018 compared to the P119.5 million net loss sustained in the same period in 2017.
Revenues went down 19.7% to P1.337 billion in January to September 2018 from P1.665 billion in the same period last year, according to LSC’s disclosure to the Philippine Stock Exchange.
Cargo volume handled by the carrier in the first nine months of this year declined 14% compared to the same period as last year due to the extended repair of M/V Lorcon Bacolod.
Industry vessel capacity, however, remained high compared to demand, lowering the average freight per twenty-foot equivalent unit.
Meanwhile, direct cost went down 16.8% to P1.384 billion from P1.664 billion in the first nine months of 2017.
LSC reiterated that its turnaround plans were already starting to reap benefits as seen in the significant improvement in its direct costs. It added that there are ongoing efforts at revenue recovery in the form of fuel surcharge, excise tax recovery, and arrastre recovery charge.
The same turnaround plans will be carried through up to the end of 2018, with improving vessel and service reliability as the top priority. The plans also include enhancing partnership with selected carriers for utmost flexibility, especially in cases of excess volumes or service disruptions; and maximizing vessel capacity, especially northbound volumes using improved pricing schemes.
LSC will also continue to reduce operating costs such as those on trucking, terminal, and cargo handling through a focused and flexible organizational structure and appropriate technology.
It noted that programs to manage profit leakage are now being implemented, focusing largely on claims reduction and improved billing and collection cycle through people, process, and technology intervention.
