Shipbroker Clarkson has sunk more than 8% on concerns about the outlook amid falling oil prices and the uncertain global economy.
The company reported half year profits up 49% at £23.4m, helped by a five month contribution from recent acquisition RS Platou.
But it warned of “ongoing headwinds” in a number of its markets, and said its performance would be weighted towards the second half. Chief executive Andi Case said:
The multi-cyclical and volatile nature of our markets has once again been demonstrated by the sudden shift in oil and other commodity prices which, when coupled with the evolving economic environment, has given rise to a consequential change in the demand supply balance in many markets.
It reported a strong performance in tankers, but rates in the dry bulk markets halved compared to the same time last year.
The company said its strategy and strong balance sheet gave it confidence about its prospects, but the update sent its shares down 229p to £25.21, the biggest faller in the FTSE 250 mid-cap index. But Panmure Gordon kept its buy rating, and analyst Gert Zonneveld said:
Clarksons delivered a robust set of interim results, characterised by strong Broking profits but a lower than expected contribution of the Financial division. While we recognise that, as previously indicated, the delivery (and earnings) profile of the group’s activities in broking and financial is likely to be more second half weighted, we have prudently trimmed our forecasts on the back of capital markets weakness and a higher Minorities line. As a leading shipbroker, Clarksons remains in an excellent position to capitalise on recovering shipping and capital markets in the medium to longer term. We retain our buy recommendation.
