Clarkson says challenging market backdrop to continue as annual profits slip
Source - SMW
Shipping services provider Clarkson reported Monday a slip in pre-tax profits as growth was held back by geopolitical uncertainty, Brexit and a weaker dollar, all of which were expected to continue into the current year.
For the 12 months to 31 December, reported pretax profit fell to £42.9m from £45.4m, while revenue grew to £337.6m from £324.0m.
The broking division, which accounted for the bulk of revenue growth, saw revenues rise to £257.7m for the year, up from £238.9m a year earlier, as activity in sale and purchase markets rebounded strongly during the second half of the year.
The financial division had a more challenging year, with 'activity being affected by a weakened sentiment in the global shipping capital markets,' the company said. 'Macro-economic uncertainties have undoubtedly led to a more cautious approach in both the shipping and offshore capital markets, and although the team executed a number of high profile transactions, we expect a similarly cautious sentiment to remain in the near-term.'
The dividend was raised to 75p, up 3% from a year earlier.
'Geo-political uncertainty and natural disasters are currently affecting global sentiment and exchange rates, which in part offsets the better visibility from an improved forward order book,' said Andi Case, Chief Executive Officer. 'These headwinds are having an impact, in particular within our financial segment, but as the year progresses, we expect these to diminish and the impact from changes in regulation around sulphur emissions to begin.'
'Consequently, we believe that the strength and breadth of Clarksons, enhanced by technology platforms which continue to be rolled out to our clients, positions the Group well for the future. The Board remains confident about the longer-term outlook for Clarksons.'