KARACHI: Pakistan National Shipping Corporation (PNSC) has embarked upon fleet development plan as part of its efforts to enhance performance.
Current projections suggest healthy growth in tankers demand across full year 2024. Crude Tanker and Product Tankers DWT demand is projected to grow by 2.9% and 6.4%, respectively, this year.
“PNSC is actively pursuing replacement of tanker vessels through new building and also exploring opportunities in the secondary market,” Asim Khan, the corporation’s commercial director, told Media.
He said that the induction of tonnage is aimed towards modernisation of fleet, reduction of corporation’s carbon footprint and compliance with foreseeable regulatory environment. “Timely phasing out of old tonnage is also a component of the corporation’s fleet development plan,” he said.
The latest financial report indicates that PNSC achieved turnover of Rs35 billion in the first quarter of 2024 as compared to Rs42.48 billion for the corresponding period last year.
The main factors leading to the decline in the PNSC’s turnover is decrease in average AFRA rate from 222 to 167 (25%) and no generation of refine petroleum and dry cargo charter-in income. The charter out rates for both segments liquid cargo (Aframax and LR-1 tankers) and dry cargo (bulk carriers) declined by 17%, 36% and 45%, respectively.
The main reason for the decline in liquid and dry cargo charter rates was the Ukraine crisis, which negatively impacted the global economy and disturbed the demand and supply, the report said.
As a result, average freight rates were significantly on higher side, which are currently coming towards the normal slope in post-recovery period.
The main reason for the decline in PNSC (Group) profit is decrease in dry cargo segment revenue (including slot charter) by Rs5.89 billion (56%), and liquid cargo segment revenue by Rs2.67 billion (9.0%).
However, during the reported period, foreign chartering segment contributed incremental revenue of Rs1.04 billion (42%). Additionally, the fact that the Group has an ageing fleet necessitated major dry-docking and repair and maintenance activity.
Resultantly, the operational days were decreased by 17% as compared to the corresponding period last year. However, upward trend in the average exchange rate against the US dollar from Rs241 as compared to Rs285 (18%), average world scale from 5.72 to 6.57 (15%) negated the negative financial impact. The PNSC witnessed profit-after-tax of Rs14.69 billion as against Rs23.96 billion, with a decline in the group’s net profit margin from 56% to 42% previously.
The profitability includes Rs3.3 billion on account of gain on sale of MT Karachi and Rs2.4 billion on account of exchange gain earned due to upward movement in exchange rate fluctuations, which are not considered as normal course of business activities.
The PNSC standalone results reflect a profit-after-tax of Rs3.07 billion as compared to profit of Rs3.97 billion in the corresponding period last year.
PNSC was able to effectively utilise the funds available during the period, supported with obtained higher rates on investment in TDR and mutual funds after negotiation with banks and financial institutions. Therefore, it was able to derive income from its investments, which amounted to Rs4.96 billion as compared to Rs1.30 billion in the corresponding period last year.
During the current period, PNSC was able to pay in full the loans obtained for MT Bolan and MT Khairpur in September 2023. –INP
