Stock Earnings: STX Pan Ocean !q profit down 69% on lower freight rates!

STX Pan Ocean Co Ltd, the shipping arm of South Korea's STX Corp, said its net profit for the quarter to March shrank 69 pct year-on-year to 25.95 mln usd because of a decline in freight rates and higher prices for bunker fuel. First-quarter sales fell 11.42 pct to to 647.87 mln usd as the company registered lower earnings from chartered vessels, even though total cargo volume jumped 24.6 pct to 20 mln tons. "While some benefit was gained by STX, such as the decrease in charter-in hire costs, lower freight rates across the board and certain imbalances in market conditions produced generally negative effects," STX Pan Ocean said in a statement. The cost of vessels rose by 88 mln usd as the company took delivery of two tankers during the quarter, it said. STX Pan Ocean president and chief executive Jong Chul Lee said: "We expect freight rates to have a soft landing in the rest of 2006, and also expect certain market imbalances to correct themselves through fleet movement. " He added: "In the longer term, STX Pan Ocean anticipates fleet growth to slow and this should lead to stability in 2006 [and] another upturn in the dry-bulk market by 2007." STX Pan Ocean said it is "cautiously optimistic of its prospects and its ability to deliver a satisfactory set of results" this year.

STX Pan Ocean Co Ltd's first quarter to March results:

Sales - 647.87 mln usd vs 731.37 mln

Pretax profit - 25.97 mln usd vs 83.88 mln

Net profit - 25.95 mln usd vs 83.53 mln

EPS - 0.015 usd vs 0.055