Global energy management company World Fuel Services (WFS) on Thursday (27 April) recorded a 13% on year decrease in net income for the first quarter (Q1) of 2023 supported by gains from its marine segment.
The company posted net income of USD 22.8 million in Q1 2023, lower than net income of USD 26.3 million seen during Q1 2022.
Revenue for its combined aviation, land and marine segments in Q1 2023 was USD 12.5 billion, a 1% jump from revenue of USD 12.4 billion in Q1 2022.
Specifically, the marine segment generated gross profit of USD 52.0 million in Q1 2023, up 11% on year from USD 47.0 million in Q1 2022.
In total, WFS sold 4.3 million metric tonnes (mt) of bunker fuel during Q1 2023, a decrease of 9% on year from 4.7 million mt of marine fuels during the similar period of last year.
“The Marine segment generated first quarter gross profit of USD 52 million. That’s an 11% increase when compared to the first quarter of last year. While bunker fuel prices have declined, marine benefited from a significantly higher interest rate and credit constrained credit environment in the first quarter,” said Ira Birns, EVP and CFO, WFS during a recent earnings call as quoted by Seeking Alpha.
“As we look ahead to the second quarter, margins are expected to remain well ahead of historical averages. However, gross profit is expected to decline sequentially driven principally by flattening prices and reduce market volatility.”
Birns said despite it being a seasonally weak quarter for the firm in the first quarter, it delivered solid overall results.
“Aviation delivered very strong performance in what is traditionally the weakest quarter for air travel, or land liquid fuels activity in North America was impacted by extreme weather on natural gas and power businesses continued to perform well. Marine continued to outperform historical averages with very strong operating margins. And we are now entering our seasonally strongest second and third quarters and remain optimistic about our opportunities to deliver strong results for the full year,” Birns added.
Related: WFS 2022 marine fuels segment records 155% on year increase in annual gross profit
Related: WFS Q3 2022 marine fuels segment gross profit up 241.6% on year to USD 74.8 mil
Related: WFS marine segment gross profit records 244% on year jump in Q2 2022
Related: WFS marine segment gross profit records 85% on year jump in Q1 2021
Related: WFS marine segment gross profit records 85% on year jump in Q1 2021
Photo credit: World Fuel Services
Published: 2 May, 2023
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