Mercator Lines (Singapore), the Indian-owned international dry bulk shipping company focused on high growth markets such as India and China, today announced an increase of 15% in net profits to US$23.3 million ($30.1 million) for the first half of financial year March 2011 (1HFY2011) compared to US$20.2 million for the corresponding period previous year.

Group revenue increased by 15% to US$81 million from US$71 million in H1 FY2010, aided by higher capacity and better spot market rates, offset partly by the expiry of a higher earning long term charter.

The Time Charter Equivalent (TCE) rate per vessel per day of US$28,000 for the half year ended September 30, 2010 remained flat. The total number of vessel operating days for the half year ended September 30, 2010 was 2,632 days compared with 2,218 days for the corresponding period previous year.

Shalabh Mittal, Managing Director and Chief Executive Officer of Mercator, says, “We are happy to announce yet another strong set of Half Yearly results with an increase in revenues and profits. Our firm contracts with reputed customers not only ensure long term revenue visibility but also keep us shielded from market volatility. The company is on a growth trajectory haven grown its asset base by two ships this year with US$60 million in Capex of which US$22 million will be invested in Q3 FY2011. Our contract cover and strong balance sheet with US$29 million cash, a low debt to equity ratio firmly positions us for further opportunistic growth.”

Mercartor has entered into a Memorandum of Agreement for the purchase of a gearless Panamax dry bulk carrier for US$22 million. The vessel, built in 1994 by Imabari Shipbuilding, Japan, has a capacity of about 69,087 dwt. With this acquisition (the second vessel purchased during the current FY), the company now has a fleet of 13 vessels. This was possible due to a strong balance sheet with sufficient cash. The company has been involved in regular fleet expansion as well as entering into long term contracts to increase its cargo base. A combination of these two factors has helped secure the fleet tonnage and ensure positive cash flows even when the dry bulk market conditions have not been very conducive.

The company now has about 80% of its capacity for FY2011 and about 60% capacity for FY2012 already contracted.