Wilhelm Wilhelmsen Holding Q1 Update

WWL & Maritime Services

The daughter company, Wallenius Wilhelmsen Logistics, or WWL, were hurt by lowering rates, higher bunker costs and currency headwinds. Surprisingly for me the improvements in the mining segment wasn’t significant enough to offset the negatives and the share price was hammered down 20%. The stock had climbed 200% in less than two years so even slightly deteriorating fundamentals got punished harshly.

For the maritime segment the EBIT-margin improved slightly from 4% to now 6%. Not enough improvement to warrant a rerating of this segment in my Excel valuation.

Discount to NAV has narrowed

The updated excel sheet for Wilhelm Wilhelmsen Holding, WWI, shows the discount to NAV at 35%, which is the lowest it has been for the past 24 months. As a result of that I have scaled down my position somewhat.

2 thoughts on “Wilhelm Wilhelmsen Holding Q1 Update

    1. Hi Dan. I also think the downward move has been exaggerated and the valuation is becoming increasingly interesting. Admittedly I did not see the pressure on shipping rates continuing like it has (and which led me to decrease my position earlier in the year) and I also thought WMS would perform better than it has – so those are two question marks that I’d like to see improving before increasing my position again. The failed Drew aquisition also puts into question management capital allocation capabilities.

      On the other hand, it is good see how they underpromised and overdelevered on synergies unlike most other companies when the word synergy is mentioned. This ought to give them margin protection going forward. I also like the fact they are exposed to the mining sector, which I think will do well in the coming years.

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