Dennis Uy’s Chelsea Logistics swings to net loss in Q1

Earnings of Davao-based businessman Dennis Uy-led Chelsea Logistics and Infrastructure Holdings Corp. swung to a net loss in the first quarter of 2020 due to the impact of lockdown to contain COVID-19 spread.

In a disclosure to the Philippine Stock Exchange on Tuesday, Chelsea said it booked a P345 million net loss in the first three months of the year from P139 million net profit year-on-year.

“The first quarter heralds the start of the traditional peak season but the Group’s financial performance was severely impacted, first by the Taal Volcano eruption and then by the Enhanced Community Quarantine (ECQ) driven by the global COVID-19 pandemic,” the company said.

Revenue was relatively flat at P1.613 billion, up 1% from P1.599 billion a year earlier.

The company’s shipping business recorded a 2% revenue increase from P1.481 billion to P1.507 billion.

Passage business’ revenues rose by 39%, from P296 million to P413 million “mainly due to the recent consolidation of The Supercat Fast Ferry Corporation, serving new routes and more passengers.”

Revenues from tugboat operations grew by 6% during the period from P82 million to P86 million due to higher number of operations.

The company’s logistics business, however, posted a 10% decline from P118 million to P106 million.

The revenue decline was due to the restricted movement of goods caused by the Taal Volcano eruption and then by the government-imposed ECQ, Chelsea said.

Operating income declined 90% to P40 million from P381 million year-on-year “attributable to the group’s limited operations due to the ECQ implemented in mid-March which is historically the start of the shipping industry’s peak season.”

“We are certain that our capital investments will bear fruit going forward. In the pipeline we have investments which are expected to generate significant cashflows: there are two vessels to be delivered this year, our 2.5-hectare logistics warehouse will be completed by the first quarter of next year and will boost capacity,” Chelsea president and CEO Chryss Alfonsus Damuy said.

“We will also be soon seeing infrastructure seaport and airport modernization projects in Davao that will make meaningful contributions in the future and generate additional revenue streams. All these are vital to the Philippine economy and will remain necessary for a long time,” Damuy said.

“The COVID-19 pandemic has severely affected companies and people, and Chelsea is no exception. The challenges will not disappear overnight and may likely persist into the next quarter. We do remain confident that with our strategic plans to combat the crisis, and with our existing resources, capacity, fixed assets and strong market share, the Chelsea Group will spring back to recovery and move faster towards the new normal,” he said.—AOL, GMA News