Rising freight rates from higher global trade and vessel shortages are expected to lift fourth-quarter profits by nearly 50 percent at Malaysia International Shipping Corp (MISC), the world's largest carrier of liquefied natural gas.
But analysts say earnings growth is likely to slow in the current financial year due to an expected fall in freight rates next year as new ships enter a competitive market. Quarterly results are due from MISC next week. Analysts expect earnings from American Eagle Tankers (AET), bought last July from Singapore's Neptune Orient Lines Ltd, will also boost profits significantly.
"The MISC profile is getting stronger and stronger," said Scott Lim, a fund manager at CMS Dresdner Asset Management. "MISC is one of the key players in the world with the AET acquisition."
Malaysia's fourth-biggest listed firm is forecast to post net profit of 590 million ringgit ($155 million) for the three months ended March 31, compared with 400 million ringgit a year earlier, according to forecasts compiled by Reuters Research.
The survey of 17 analysts showed consensus net profit for MISC in the fiscal year to end-March 2004 of 2.15 billion ringgit, sharply up from 1.31 billion in 2003.
But profit for the 2005 fiscal year is forecast to rise just 13 percent from the previous year to 2.43 billion ringgit as the prospect of more ships entering the market and a slowing in China's economic growth may see rates peak this year.
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