Odfjell posted very solid 3Q23 figures yesterday evening. They have prepared the analysts for the reduction QoQ, but the figures came in very much in line with 2Q23 and beating the consensus expectations. However, although 4Q is seasonally stronger, due to more drydocking, the earnings are guided stable QoQ in 4Q23.
Another strong quarter delivered
Odfjell posted again very solid results yesterday evening, in line with 2Q23 and beating the consensus. EBITDA of USD 114m was in between 2Q23 result (USD 118m) and our USD 110m predictions, while the consensus was even more conservative at USD 107m. Adjusted net profit came in at USD 49m compared to USD 45-47m our and consensus’ expectations. Terminals were stable. Rates on renewed COAs during the quarter were up 18% on average, covering 7% of estimated annual contract volume.
4Q23 to be stable, although 4Q is seasonally stronger period
The fourth quarter is historically stronger and both the activity levels and freight rates are projected to remain at healthy levels for the rest of the year. However, the company communicated to have more vessels than usual planned for drydocking in 4Q23, resulting in fewer commercial days. This should keep the Tanker results in line QoQ and with stable Terminals, the company guides to deliver stable earnings in 4Q23.
No major changes to estimates should follow the report, while the recommendation depends on the stock movement.
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Source: Norne Research