Domestic carrier Lorenzo Shipping Corp (LSC) recorded a 36.7% lower net loss in the first quarter of 2020 to P32.695 million from P51.673 million in the same period last year.
Revenues in the first quarter amounted to P733 million, 0.24% less than P734.963 year-on-year, LSC said in a regulatory disclosure.
Container volumes handled in the first quarter was up 2% from the same period last year.
Gross profit jumped 809% to P10 million from P1.1 million last year.
LSC said there was a 3.2% decrease in direct cost amounting to P710.3 million from last year’s P733.8 million due to lower fuel consumption and transport voyage service cost.
LSC is implementing a turnaround plan until end-2020, noting it is already reaping benefits as shown in significant improvement in direct costs.
Reporting net losses since 2015, LSC has started to post lower losses from 2017 up to the first nine months of 2019. However, it reported a wider net loss of P174.461 million for the entire 2019 from the 2018 loss of P146.113 million.
LSC’s turnaround plans, being implemented for years now, include enhancing partnerships with select carriers for flexibility, especially in cases of excess volumes or service disruptions; and maximizing vessel capacity, especially for northbound volumes, using improved pricing schemes.
LSC will also continue to reduce operating costs for trucking, terminal operations, and cargo handling through a focused and flexible organizational structure and appropriate technology.
Programs to manage profit leakage are likewise being implemented, focusing largely on claims reduction and improved billing and collection cycle through people, process and technology intervention.
Meanwhile, LSC said it “remains fully operational and committed in delivering on its promises to clients and partners” amid the coronavirus disease (COVID-19) pandemic.
The line calls the ports of Manila, Cebu, Bacolod, Iloilo, Dumaguete, Davao, Cagayan De Oro, Zamboanga, Cotabato and General Santos using its own container vessels, and will sail as scheduled with minimal to no service disruption. It owns various types of equipment and facilities, including land-based forklifts, top lifts, trucks, container yards and warehouses.
It enacted risk mitigation and business continuity protocols and put in place other work arrangement options to limit exposure of employees.
LSC said it cannot determine yet the impact of the pandemic on its financial position, performance and cash flows as the pandemic is evolving in nature but noted it “could have a material impact on its 2020 financial results.”
“While the present disruptions can slow down revenue inflows, the safety and security measures immediately adopted by the company and the cost reduction during the quarantine period are expected to mitigate the unfavorable impact on business,” LSC said.