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Clarksons takes Platou acquisition in its stride, but integration costs drag H1 profit

Clarksons takes Platou acquisition in its stride, but integration costs drag H1 profit

Clarksons has reported a GBP6.2m ($9.7m) profit for the first six months of 2015, its first half-year result since acquiring RS Platou.

The results include five months of contributions from RS Platou, as Clarkson's acquisition of the company was completed in the first quarter, and compares to a GBP9.8m profit in the same period last year.

The costs involved in that acquisition, and subsequent relocation of offices to integrate staff, were the reasons behind Clarkson's lighter bottom line; exceptional items and acquisition costs totalled GBP11m in the first six months of the year, significantly higher than the GBP1.7m reported in H1 2014.

The company's broking division returned a result of GBP22m, up from GBP15.1m in the first half of 2014, led by a strong tanker market in all sectors, and a rise in sale and purchase activity for container ships towards the end of the half.

In the offshore market the oil majors' target of reducing expenditure by 20-30% led to significant cut backs for across OSVs, subsea and drilling. Pressure continues on rates, contracts are being terminated early and reduced demand is leaving the market oversupplied, reducing utilisation.

In the dry bulk market rates were at their lowest for decades, for the first half of the year the Baltic Dry Index (BDI) averaged 43% lower than in the same six months last year.

Andi Case, chief executive of Clarksons commented: “The multi-cyclical and volatile nature of our markets has once again been demonstrated by the sudden shift in oil and other commodity prices, giving rise to a consequential change in the demand supply balance in many markets.

“As previously outlined, the delivery profile of our activities in broking and financial will result in a weighting in performance towards the second half of the year. Whilst we are mindful of the ongoing headwinds in a number of our markets, our strategy has proven to be robust in this trading environment and with a strong balance sheet underpinning our business model we have confidence in Clarksons’ prospects for continued progress in the second half.”

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