Shipping firm raises earnings guidance for third time this year
Abu Dhabi National Oil Company subsidiary Adnoc Logistics & Services posted the strongest quarterly profit in its history, a nearly fourfold increase from a year earlier, as the war between Iran and the United States and its regional allies continued to disrupt shipping through the Strait of Hormuz.
The conflict is in its sixth month, and shipping through the strait — through which about a fifth of the world’s oil supply previously flowed — remains largely disrupted even as diplomatic efforts continue to reopen the waterway, according to The Wall Street Journal.
Chief Executive Abdulkareem Al Masabi said the company’s ability to respond quickly to volatile market conditions, alongside strong shipping fundamentals, supported earnings. The company said its diversified operations and long-term contracts with Adnoc Group helped it navigate the regional disruption.
Adnoc L&S has continued expanding its fleet in response to the volatile shipping environment. The company said vessel acquisitions and newbuild commitments valued at about $2.3 billion have been made so far this year, part of $5.7 billion in total capital commitments.
The disruption has not benefited every segment of the business equally. The company said lower utilization and reduced day rates for its jack-up barge fleet partly reflected the regional geopolitical environment.
The company raised its full-year earnings guidance for the third time, citing continued strength in shipping. It cautioned, however, that full-year results remain highly dependent on regional developments.