New VLCCs Drive Bahri’s Profit Surge

National Shipping Company of Saudi Arabia (Bahri) has seen a rise in its profits in the first quarter of 2016, as the company recorded a net profit of SAR 611.9 million (USD 163.2 million) in the first three months of the year.

The company’s net profit jumped by 53% compared to the same period a year earlier when it reached SAR 398.4 million.

Bahri said that the surge is mainly attributed to an increase in operating revenues as a result of buying and taking delivery of several very large crude carriers (VLCCs), as the company’s fleet of VLCCs was expanded by five vessels, reaching a total of 36 VLCCs during the quarter.

Other factors which influenced the positive income were a rise in average time charter equivalent (TCE) rate in crude oil transportation spot market during the quarter compared to the corresponding quarter of 2015, a jump in the operating revenues and net income of general cargo transportation sector due to the improvement of the operating and commercial performance, as well as a drop in average ship running expenses and average bunker prices.

Bahri’s operational profit also experienced a surge of 65%, from the SAR 427.9 million in the first quarter of 2015 to SAR 709.7 million in the corresponding period of 2016.

On April 6, the company’s subsidiary National Chemical Carriers (NCC) took delivery of the third out of five second-hand Medium Range tankers bought in February for a price of USD 166.5 million.

Two more product tankers, built in 2014 at Hyundai Mipo Dockyard in South Korea for Scorpio Tankers Inc, are expected to be delivered to their new owner by the end of June 2016.