Fesco’s first quarter profit dipped 3.8 percent from a year earlier as the Russian shipping, port, rail freight and logistics group sold almost half of its vessels.
Earnings before interest, tax, depreciation and amortization declined to $48.4 million in the three months to May 31 from $50.3 million in the same period in 2012 as revenue grew 4.7 percent to $275 million.
Shipping revenues slumped to $17.7 million from $42.2 million and profit collapsed to $200,000 from $5.1 million as the fleet was slimmed from 50 ships to 27 amid lower global time charter rates.
The company said the shipping unit is evolving from owning and managing vessels to supporting the liner and logistics business.
The liner and logistics unit booked revenues of $158.3 million in the seasonally slack quarter, up from $128.3 million a year ago, and posted a profit of $8.8 million, compared with a loss of $90,000.
Port revenue, mostly from the Vladivostok container terminal in the Russian Far East, more than doubled to $46.8 million from $20.1 million, and earnings jumped to $17.8 million from $9.7 million.
Rail transport revenue was down almost a fifth at $74.6 million, and earnings slumped to $28.4 million from $$44.1 million, but the company said it expects volume to rebound in the second half.
Deep sea container traffic grew almost 25 percent to 65,500 20-foot equivalent units, but domestic volume declined 14.6 percent to 12,800 TEUs as the company faced tougher competition in its home market.
Rail container volume increased 5.3 percent to 64,100 TEUs, and intermodal shipments were up almost 35 percent to 60,200 TEUs.
Fesco sold $875 million of bonds during the quarter to pay down outstanding debt and debt taken on in its takeover by the Moscow-based Summa group in late 2012.