Horizon Lines Inc (OTCMKTS:HRZL) posted financial results for 4Q ended December 21, 2014. The adjusted EBITDA surged 26.6% over the same quarter a year ago. The growth in adjusted EBITDA was led largely by increased fuel recovery, lower replacement vessel and transit costs linked with dry-docking of the vessels and higher space charter revenue.
The management view
Steve Rubin, the President and CEO said that the factors leading to adjusted EBITDA growth were to some extent offset by lower rates, net of higher vessel operating and fuel costs. The financial numbers represent the third successive quarter of strong growth in terms of adjusted EBITDA over previous ear results. The 4Q operating loss was led by a $65.7 million pre-tax restructuring expense associated with the decision to exit Puerto Rico market.
Back in November 2014, Horizon Lines Inc (OTCMKTS:HRZL) disclosed its intensions to stop providing liner service between the U.S. and Puerto Rico and stop San Juan terminal service activities in 1Q2015. The company provided its services in the Puerto Rico market for all of FY2014. It anticipates achieving the accounting criteria to categorize Puerto Rico as a discontinued operation during FY2015.
Horizon Lines stated that the container volume for 4Q2014 amounted to 56,872 revenue loads indicating a jump of 244 loads from the same quarter a year ago. The unit revenue per container came at $4,110 in 4Q compared with $4,187 in 4Q2013. The net of fuel surcharges came at $3,153 indicating a decline of 2.1% from $3,222 a year ago. It was due to the reason of more cars transported in Hawaii. The vessel fuel costs stood at $572 per metric ton in 4Q, down 10.9% from $642 per ton for the same period in FY2013. Horizon Lines 4Q operating revenue surged 0.2% to $255.8 million compared to $255.4 million a year ago.