Clarkson rocked by shipping fall
Clarkson PLC (Clarksons) announced preliminary results for the twelve months ended 31 December 2012.Andi Case, Chief Executive, commented:“Last year the shipping markets remained significantly, and in some cases increasingly, challenged, with global economic weakness and the demand/supply imbalance of recent years still a feature.“2012 seaborne trade grew by approximately 4.5%, but this was not enough to counterbalance the net fleet growth of 6.0%, although there were significant milestones, with a record year for the demolition of vessels and, for the first time in more than 10 years, demolition exceeding the contracting of new tonnage.“While we were able to grow market shares and win new clients, progress made in some parts of our business was not enough to compensate for weaker performances by others, including our broking division and particularly our financial division which has since been refocused.“This year will remain difficult for the industry, but we are confident Clarksons will meet those challenges, with a proven strategy, a sound balance sheet, investment in our world-leading services and a commitment to deliver shareholder value.”
Chairman’s review
Clarksons can trace its history back 160 years, but few eras have been as challenging for the shipping industry as the one we are currently experiencing. The depressed global macroeconomic situation, uncertainty caused by the Euro-crisis and a difficult debt market have conspired with natural issues, including droughts in the US last year, to produce a gloomy backdrop for the sector.These difficult conditions put pressure on all businesses and these results show that Clarksons is not immune. However, we remain convinced that our strategy of building a broad-based business with a global footprint, which provides services which add real value to clients, works and our continuing increases in market share bears this out.
Some parts of our broking business have inevitably felt the impact of falling rates and asset values, but others have registered good growth. Financial operations have felt the double hit of start-up costs and low deal flow, but we continue to lay the foundations for the future. Our rapidly growing support and world-leading research divisions have both performed strongly.
All employees have worked hard to achieve these results, but management realises that when the market offers little help, focus on costs and improving efficiency within the business are key.
Control of costs is always important, but comforted by our strong balance sheet we also continue to invest in our strategy. We recruit and develop the best people, give them the best technology to do their job and provide them with the best support network. This gives us the tools to service clients, develop our business and deliver value to investors.
Results
Underlying profit before tax of £20.4m (2011: £32.2m) was lower than the previous year, resulting from challenging market conditions. The underlying earnings per share was 76.8p (2011: 121.5p).
Basic earnings per share of 87.2p (2011: 134.1p) include the exceptional receipt of a legal settlement of £4.5m (2011: £3.2m reimbursed legal fees), and acquisition costs of £1.6m (2011: £nil).
Dividend
I am delighted that for the tenth successive year we have been able to raise our dividend payment.
The board is recommending a final dividend of 33p (2011: 32p). The interim dividend was 18p (2011: 18p) giving a total dividend of 51p (2011: 50p). The dividend is covered 1.7 times.
The dividend will be payable on 7 June 2013 to shareholders on the register as at 24 May 2013, subject to shareholder approval.
Future
Although there are few signs of improvement in the shipping markets as we begin 2013, we remain confident in our strategy and our ability to offer the best service to our clients. Challenging times present opportunities and our history has taught us to be prepared for the future, whatever the current conditions.http://www.clarksons.com/files/financialreport/2628895/2012_preliminary_results.pdf
OPINION
09 March 2013 - 23:05
Clarkson rocked by shipping fall
Clarkson PLC (Clarksons) announced preliminary results for the twelve months ended 31 December 2012.
OPINION
09 March 2013 - 23:05
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