Grindrod rides the waves of success

Feb 26, 2003
Author: L&O

Grindrod Limited, the owner of Unicorn Shipping and Island View Shipping, produced a healthy and profitable return in 2002 for the third year in a row, further cementing a remarkable turnaround in the fortunes of the Durban-based shipping and logistics company.

A 43 % increase in headline earnings per share to 174.9 cents and 30 % increase in final dividend, with earnings topping R165.4 million from a revenue turnover of R2.2Bn (up 23 % from R1.8Bn) brought smiles to the faces of members of the executive at the presentation in a Durban hotel last week (20 February 2003).

“The Group produced these positive results despite difficult trading conditions for some of the divisions,” said Ivan Clark, group managing director.

During the year the shipping services division showed positive results despite depressed shipping markets for much of the year. “We took advantage of the low markets in 2002 to increase our owned and chartered fleet,” said Clark. The loss making Quadrant Container Line was closed and full provision made for discontinuation costs.

Unicorn Shipping completed its planned dry cargo fleet replacement programme and placed orders for three new building products tankers, one of which will go to Southern Tankers, joint venture between Unicorn Tankers and the black empowerment company Dudula Shipping.

Island View Shipping (IVS) increased its chartered fleet during the year and developed a worldwide modern handysize pool in partnership with the respected international shipowner and operator Lauritzen Bulkers.

It also expanded its participation in the Capesize and Panamax markets. “This positions IVS to take advantage of improved shipping markets during 2003.”

During the year Grindrod’s seafreight logistics business formed a joint venture between Unicorn Lines and Safmarine Container Line. Now trading as Unifeeder and servicing African coastal feeder and regional shipping needs between Angola in the west and Mozambique in the east, the venture has settled down well.

Clark said the highlight of the year was the growth in land-based business, which has now repeated the turnaround shown by the group’s shipping line’s activities. With its broader product mix and improved market share the group’s freight management division grew substantially, said Clark, adding that this division was now a major contributor to the group’s profitability. “We will continue to look for further growth in 2003.”

Richards Bay has been the focus of expansion for the landfreight logistics business where further terminal projects are in progress. The Kusasa Bulk Terminal expansion project was completed on time in the last quarter of 2002.

Look ahead, Clark said that with the current strong world shipping markets as well as the growth of existing businesses the group was confident of achieving further growth in earnings in 2003. “This is in spite of the recent depreciation of the rand against the dollar.”

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