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Container company Triton reports $94.2m profit

Earnings reported: Triton’s adjusted net income for the third quarter was up 46.3 per cent compared with the same period last year (Photograph by Paul O’Driscoll/Bloomberg News)

Bermudian-based Triton International Limited, the world’s largest lessor of intermodal containers, has reported a profit of $94.2 million for the third quarter.

That was just over $10 million lower than the second quarter, however that period included a one-time gain of $21 million from the sale of a building.

The third-quarter adjusted net income was $94.8 million, or $1.17 per share, an increase of 46.3 per cent on the same period last year, and up 6.4 per cent from the second quarter.

The company reported the container pick-up activity remained strong with its utilisation averaging 98.7 per cent.

Brian Sondey, chief executive officer of Triton, said: “We realised an annualised return on equity of 16.9 per cent.

“Triton’s strong financial results continue to be driven by outstanding operational performance, our unique competitive advantages and a favourable market environment. Container pick-up activity was strong throughout the third quarter, reflecting ongoing trade growth and a tight supply/demand balance for containers. We also continued to benefit from an increase in the share for leasing relative to direct container purchases by our customers, and a continued high leasing deal share for Triton.”

Mr Sondey said the start of the fourth quarter typically marks the end of the peak season for dry containers, and net container pick-up activity has slowed from the high volumes in the second and third quarters. He also said that new container prices and market lease rates have also decreased as demand has slowed seasonally.

“Triton continues to grow its fleet through value-added investment and we have ordered $1.5 billion of containers for delivery in 2018. We continue to focus on reducing our exposure to changes in market conditions by extending our lease durations, and the average initial lease duration for new container leases originated this year is approximately seven years,” Mr Sondey said.

Giving an outlook projection ahead, he said: “We expect our adjusted net income in the fourth quarter will remain in the same range as our strong third-quarter results. Looking forward to 2019, the imposition of increased tariffs on goods traded between the United States and China has added uncertainty to global economic and trade forecasts and to our market.

“However, our customers continue to believe the increased tariffs will not have a significant impact on overall global container trading volumes, and market forecasters are currently projecting trade growth will remain solidly positive in 2019. We also expect the market uncertainty will encourage our customers to continue to rely heavily on leasing.”

As of the end of last month, Triton had repurchased approximately one million common shares for a total of $30.1 million at an average price per share of $30.84. It currently has $169.9 million remaining available of a $200 million share repurchase authorised by the board in August.