In a statement issued on August 17, Grindrod told shareholders that it forecasts a pre-tax loss for the six month period ended June 30 of between Rand 340m and 400m compared with a pre-tax profit of Rand 327.9m for the first six months of 2015, and a final loss for the first six months of 2016 of between Rand 1bn and 1.15bn compared with a profit of Rand 303.2m for the six months to June 30 2015.
Grindrod’s first-half financial performance was adversely affected by exceptionally-weak dry-bulk shipping rates during the first quarter, which have since recovered with rates now well in excess of operating costs, and the continued depressed state of the railway and freight service markets. This was mitigated by continued strong performances in the tanker and ship operating businesses, while a competitively-priced logistics chain and improved commodity prices have resulted in significant contracted volume for the second half of the year.
“The Board has reviewed the group's strategy and decided to sell the locomotive assembly business,” Grindrod says. However, the company has not published any information on the timing of the sale or the future of its railway infrastructure business.
Grindrod is currently supplying a fleet of 10 GL30SCC-AC mainline and six 522kW GS7S3M shunting locomotives to Bolloré Logistics under a Rand 400m contract awarded in June 2015. Five of the 2.46MW mainline locomotives are for Cameroon and the remaining five along with the six shunters are for Sitarail in Ivory Coast and Burkina Faso. Four of the mainline and four of the shunting locomotives have been delivered so far.
The Co-Co 20-tonne-axleload mainline locomotives have a continuous tractive effort of 400kN at 20km/h, a maximum speed of 100km/h and single cabs.