Market challenges cut Bibby Line profits to £29.5m

Shipping and logistics company Bibby Line Group saw its profits and revenues dip in 2015 after facing “challenging” market conditions.

The Liverpool-headquartered company, which employs around 6,000 people, saw its pre-tax profit slide by almost 33% to £29.5m in the year ending December 31, while its revenues dipped 15% to £1.45bn.

Despite the challenging market conditions, Bibby Line managed to close the year with cash balances and net assets of £298m, up from £280m in 2014, putting the firm in a position to capitalise on future opportunities.

The company has said that historic low shipping rates and plummeting oil prices, paired with food price deflation and low interest rates, slashed its operating profits and turnover.

Bibby Line strengthened its balance sheet after selling off its Australian financial services business at the end of last year, and then its ship management operations at the beginning of 2016.

The firm’s Bibby Offshore business, which provides underwater services for the oil and gas sector, saw revenues slide by 37% to £241m. Bibby Line’s financial services arm, meanwhile, showed a turnover decrease of 0.59%, at £167m.

Similar dips in revenue were reported across the company’s retail, marine and distribution businesses.

The managing director of Bibby Line Group, Sir Michael Bibby, said: “Low oil prices, reductions in key global trade flows, and low interest rates have combined to create challenging operating conditions.

“As a business we have responded to these challenges and have again focused on developing unique products and services, productivity improvements and reviewing where we can consolidate the market segments we operate in.”

He continued: “Looking ahead, we’re in a strong position. We have the appropriate financing in place to handle unexpected events whilst taking up exceptional investment opportunities to deliver an even better business as the next upturn approaches.”

Commenting on the results, Bibby Line chairman Paul Drechsler said that while the company faced challenges across many parts of its sectors and geographies in 2015, the “macro-economic pressures” have not changed the company’s strategy as it aims for “diversified growth and long term shareholder value”.

Paul explained: “The year ahead seems set to be at least as challenging as a result of global and economic uncertainties, compounded by risks and unknowns associated with the EU Referendum, which will impact supply, demand and pricing in many of our businesses.

“The group will continue to execute its strategy, accelerating pace where necessary and capitalising on the opportunities that will inevitably arise in such circumstances.”