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SGX Mainboard-listed Chemoil, one of the world’s leading suppliers of marine fuel, has today reported a net loss of US$13.5 million for the first quarter of 2010.

The figure represents a US$22.3 million decrease in earnings compared to the net profit of US$8.8 million achieved during the first three months of 2009.

The first quarter net loss was recorded despite a 78 percent rise in first quarter revenue, year-on-year, from US$981 million in 2009 to US$1,748.4 million in 2010.

Gross contribution per metric ton (GCMT), the company’s key margin indicator, fell to US$1.74 per metric tonne for the first three months of 2010 compared to US$8.74 per metric tonne for the corresponding period last year.

Sales volumes during the first quarter of this year reached 3.7 million metric tonnes, a fall of 2 percent compared to 3.8 million metric tons in 2009 - attributable to lower wholesale volumes in Europe, the Americas and Asia, but compensated by higher retail sales.

Chemoil said the company’s results were also negatively impacted by certain one-time charges including a loss from the disposal of a delivery vessel and the full realization of the employee stock option costs due to the accelerated vesting of outstanding options upon the change in majority ownership.

Chemoil’s Chairman and CEO, Mike Bandy, commented: “Despite the continued weakness in the global shipping industry, Chemoil has consolidated its market position in the retail bunker segment as reflected by our improved delivery volumes with 2.5 million metric tons for the first quarter of 2010. This represents an increase of 14% from the corresponding period last year, and accounted for about two-thirds of all our volumes.

“However, we face a continued narrowing of wholesale-retail spreads reaching among the lowest levels in recent years due to weak demand and the lack of cheaper fuel sources.”

Chemoil’s Chief Financial Officer, Mr Jerome Lorenzo, said: “Chemoil has taken action to improve profitability and operating efficiencies while implementing measures to reduce costs. The company is thoroughly reviewing its operations and aims to reduce commercial and operational risks where possible in order to manage our downside.”

Whilst the ongoing global recession has impacted parts of Chemoil’s business, Chemoil said the company’s logistics assets continued to provide stable contribution. Moreover, Chemoil said its financial position remains strong with shareholder equity totalling US$291 million as of March 31, 2010.

Chemoil added that reviews are being conducted across all elements of Chemoil’s business, specifically its leases of storage tanks and barging operations to optimize cost efficiencies.

Mr Bandy concluded: “Now that the uncertainty over our ownership and listing status has been resolved, our focus can be directed towards realizing the potential synergies of having two major international trading houses as our shareholders and who will be our partners in delivering value for our customers and shareholders.”