TROUBLED American shipping giant Horizon Lines has narrowed its fourth quarter loss 142 per cent in 2012 to US$94.7 million year on year as its revenue increased 4.6 per cent to $1.074 billion.
The Jones Act carrier, operating between the Lower 48 and Alaska, Hawaii and Puerto Rico, expects improvement in 2013, estimating EBITDA between $85 million and $97 million, up from $66 million in 2012.
Fourth quarter container volumes were down 6.1 per cent year on year, but container revenue, net of fuel surcharges, was up 3.1 per cent.
Horizon president and CEO Sam Woodward said the container traffic decline was offset by a 3.1 per cent rise in revenue, fuel surcharges, but a Puerto Rico volume fall-off drove a decrease in revenue and revenue loads.
Last year the company dry-docked three ships in China that operate its Puerto Rico service "to facilitate extensive maintenance and high-quality enhancements in the most cost-efficient manner possible. Incremental transit and crew costs associated with dry-dockings negatively impacted 2012 EBITDA by $3.3 million."
Fourth-quarter results were also hurt by a $4.3 million restructuring charge related to a decision to reduce sailings between Jacksonville and San Juan from twice to once a week, and to further reduce the non-union workforce.
It is also relocating its the northeast service from the New Jersey terminal to Philadelphia to cut costs, strengthen the financial performance of its Puerto Rico trade lane and invest in the business over the long term. This will result in a restructuring charge of $6 million in the first half of this year.
Looking ahead, revenue container volume and rates are expected to be slightly higher than 2012 levels, excluding the loss of revenue loads related to the Puerto Rico service reduction.
WORLD SHIPPING
15 March 2013 - 21:14
Horizon narrows loss 142pc to US$94.7 million as revenue rises 4.6pc
Horizon narrows loss 142pc to US$94.7 million as revenue rises 4.6pc
WORLD SHIPPING
15 March 2013 - 21:14
Horizon narrows loss 142pc to US$94.7 million as revenue rises 4.6pc
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