New York-listed oil and bunker trading firm World Fuel Services (WFS) posted a 37% increase in profit for the first quarter (Q1) ended 31 March 2019.
It recorded net profit of $42.8 million in Q1 2019, compared to profit of $31.2 million in Q1 2018, show latest figures.
Total revenue from its aviation, land and marine segments was $8.68 billion in Q1 2019, 5.5% lower than revenue of $9.18 billion during the similar quarter last year.
“The year-over-year decrease in revenue is principally driven by the decline in volumes in our marine and land segments,” explained WFS Chairman and CEO Michael Kasbar in a recent earning call.
Specifically, the company’s marine segment posted gross profit of $35.2 million in Q1 2019, higher than gross profit of $31.2 million in Q1 2018.
Its marine segment recorded revenue of $1.93 billion in Q1 2019, down from revenue of $2.03 billion in Q1 2018.
“Our marine segment delivered positive year-over-year results and made judicious choices about our portfolio while maintaining a focus on cost efficiency and prudent risk management,” he notes.
“Gross profit margins remain strong in Q1 and our focus on returns on capital is designed to continue that trend.
“We are leveraging the supply and logistics competencies we already have in place across all of our businesses to capture internal synergies, which will further augment our efforts to address the industry challenge, its challenge is inherent within the IMO 2020 low-sulphur regulations.”
In Q1 2019, WFS sold 5.2 million metric tonnes (mt) of marine fuel, down 575,000 mt compared to the first quarter of last year.
“The volume reduction principally related to our continued efforts to exit certain low margin business activities in Asia,” said Kasbar who was optimistic of WFS’s performance for its marine segment, moving forward.
“The marine team continues to focus on growth opportunities, which means our return thresholds including the identification and penetration of new markets,” he adds.
“Our team continues to execute well with core margins and returns remaining well above the prior year.
“Looking ahead to the second quarter, we expect marine gross profit to be similar to the first quarter, which would again, drive solid year-over-year improvement.”
Related: WFS returns to profit for 2018 in ‘year of continuing transformation’
Related: WFS records ‘better than expected performance’ in marine segment
Related: WFS Q2 bunker sales volume 13% down on year
Related: WFS posts Q1 net profit on increase in oil prices, offset by lower volume
Related: WFS posts net loss of $142.0 million in 2017
Photo credit: World Fuel Services
Published: 26 April, 2019
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