Wallenius Wilhelmsen

Wilh. Wilhelmsen ASA: Results for the third quarter of 2016

A decrease in transported volumes, combined with a

suboptimal cargo mix in the shipping segment,

negatively affected WWASA's results in the third

quarter of 2016. The logistics segment remained

stable.

Total income for the third quarter was USD 418

million, down from USD 827 million in the second

quarter. The operating profit ended at USD 32 million,

down from USD 417 million in the previous quarter.

The sharp decline in total income and operating profit

quarter on quarter was mainly caused by non-recurring

items related to the demerger of Den Norske

Amerikalinje with its shareholding in Hyundai Glovis.

Adjusted for non-recurring items, total income and

operating profit fell 8% and 27% respectively quarter

on quarter.

"The underlying third quarter result was weak mainly

due to low contribution from the shipping segment.

Volumes declined by 9% from the previous quarter, and

the cargo mix continues to be suboptimal given our

advanced fleet. A comprehensive strike in the

automotive industry in Korea caused a bigger decline

in transported volumes than anticipated", says Jan

Evyin Wang, president and CEO of WWASA.

"Our logistics activities continue to deliver

satisfying results and delivered stable performance

quarter on quarter", says Wang.

The car carrying markets are affected by surplus

tonnage and pressure on rates. "To mitigate the

negative impact, measures have been taken such as: re-

delivery of time charter tonnage, green recycling,

charter-out, slow steaming, and early dry-docking"

says Wang.

The letter of intent signed 5 September to merge

Wallenius and WWASA is expected to be completed during

first quarter of 2017.

Commenting on the prospects for WWASA, Mr Wang

states: "We do not see any clear signs of volume

growth in the remaining quarter of 2016. We also

expect a continued pressure on margins. The global

political landscape adds further uncertainties to the

picture".

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