Seacor Holdings’ harbour towage services during H2 2020 have been challenged by hurricanes in the US Gulf and the Covid-19 pandemic
The Florida-headquartered group reported a dive in operating income during Q3 2020 to US$5.6M, compared with US$12.5M in the same period the year before.
Its cash earnings were US$18M during Q3 2020, compared with US$27.7M in the same quarter in 2019. Its operations continued to be impacted in October 2020.
Seacor Holdings executive chairman and chief executive officer Charles Fabrikant said the group’s operations, including harbour towage, ferries, liner services and inland barges, were challenged by coronavirus, but there were positive signs.
“All of our businesses have continued to operate during these challenging times,” Mr Fabrikant said. “Several of our businesses started to recover in July from the severe falloff of activity in Q2 2020.”
Demand for freight services into the Bahamas and Turks & Caicos started to pick up in July, and tug operations improved due to rising ship dockings.
“Harbour towing enjoyed better results early in the third quarter, but major storm activity in August and September caused short-term reductions in activity,” said Mr Fabrikant. Operating results for Seacor Island Lines and Seabulk Towing continued to be negatively impacted by the Covid-19 pandemic.
As ship calls into port networks serviced by Seacor’s harbour towing were beginning to recover, along came seasonal hurricanes resulting in port closures along the US Gulf coast.
Mr Fabrikant said Q4 2020 should see improvements in harbour towage. “Activity in October, thus far, has been trending positive again,” he said.
Seacor’s inland transportation and logistics services was affected by Covid-19 during Q3 2020, with operating results for barge operations impacted by idle equipment.
This was exacerbated by the delayed start to the harvest in the lower Mississippi River region, lock maintenance and closures on the Illinois River and lower activity in the St Louis region.
But Mr Fabrikant said barge operations and margins could improve due to a remote market. “Good news is China increased imports of US agricultural products late in the third quarter pushing barge rates higher,” he said.
“I hope the better margins will be sustained as exports to China and other destinations pick up with the seasonal harvest,” Mr Fabrikant added.
There was also a positive note from Seacor’s chemical tanker operations, where Sea-Vista secured a new multi-year time charter for a petrochemical carrier, adding approximately US$45M of revenue backlog to the almost US$200M the company had at the end of September 2020.
Seacor Holding’s capital commitments at 30 September 2020 were US$55.3M including newbuilding orders for four US-flagged harbour tugs, one inland river towboat, six inland river dry-cargo barges and two foreign-flag rail ferries.
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