Profits at Milaha plunged by more than 50% in the six months of 2017, with the tough market environment hurting Qatar’s state-owned shipping company.
Its ports and container shipping segment, Milaha Maritime & Logistics, suffered a 61% decline in net profit of QR46m (US$13m) in its first results since the regional blockade by several Gulf countries was enforced in early June.
The company attributed this drop to “continued pricing pressure in container shipping and lower profits from our ports business.”
Sheikh Ali bin Jassim Al Thani, chairman of Milaha’s board of directors, stated: “We are in the midst of an unusually prolonged global downturn across most marine sectors. However, we remain financially strong and will continue to invest prudently for the long term.”
Milaha’s gas and petrochemcial segment saw profits fall by QR96m (US$26m) as depressed rates and vessel oversupply impacted the tanker and gas carrier sectors while joint venture operations also produced lower profits.#
The company’s offshore segment also suffered a QR30m (US$8m) decline in profits, owing to vessel oversupply leading to depressed charter rates and utilisation, noted the carrier.
Abdulrahman Essa Al-Mannai, Milaha’s president and CEO, said: “We are actively taking steps to mitigate the impact of the current downturn, from both a cost as well as revenue perspective. In this regard, we see a number of short and medium term opportunities to position ourselves more strongly for when markets improve.”
With the regional blockade only affecting one month out of the half year results, prospects for the remainder of the year do not seem to be very positive, with vessels now routed to and from Omani ports instead of those in Saudi Arabia and the UAE.
However, the company did note in July that Hamad Port in Qatar was still operating at full capacity.