According to Newton’s Laws of Physics, "Every object in a state of uniform motion tends to remain in that state of motion unless an external force is applied to it." For investors seeing their stock going from virtually not trading to gaining some traction and liquidity, the concept of Newton’s Law (which was actually built upon Galileo’s principles) is a welcome blessing, especially when that motion is upward.
For the shareholders of Winland Ocean Shipping Corp. (OTCBB:WLOL), December has been a fruitful month that has certainly set the share price of WLOL in motion. Based in Hong Kong, Winland is a global shipping company with a fleet of 11 company-owned vessels, mainly in the handysize and supramax category, engaged in ocean transportation of dry bulk cargoes and chartering brokerage services worldwide.
The recent movement appears to be a product of one substantial piece of news after another for a company that has been relatively quiet throughout the rest of 2011. The signs were coming when in November Winland released third quarter financials that showed net income increased 291% to $3.0 million U.S. from $0.77 million U.S. in the second quarter of 2011. Compared with the same quarter in 2010, net income increased 84% from $1.66 million. Those quarterly gains robustly outpaced the Baltic Dry Index during the same periods.
But, that was just the start as December has come in with a roar of new contracts. Early in the month, the company reported that its subsidiary Fon Tai Shipping Co., Limited and Viterra Asia Pte Ltd. Singapore entered a $2.2-million U.S. shipping contract to transport 53,300 MT yellow peas from Canada to India.
A few days later, Winland announced a $2.88-million U.S. shipping contract to transport steel product from the Black Sea to Far East. Three days later, on December 15, a new deal to transport 150,000 to 200,000 tons of dolomite for Sojitz Corporation from China to Japan was reported, putting another $2.5 million U.S. into the Winland coffers.
Those contracts -- which, combined, tallied $7.58 million in revenue -- were topped by Tuesday’s news of a new $7.6-million U.S. contract for shipping services which will last throughout 2012. Per the terms of the contract, Winland will transport over a half million ton pig iron and HBI ("Hot Briquetted Iron") from the Black Sea Area and South America to Asia. All told, December contracts equal a stellar $15.18 million U.S. in revenue. The strong month is possibly a bellwether that could be putting the company back on track towards a revenue stream of 2008 proportion which generated $84.2 million U.S. in revenue and $19.1 million U.S. in net income.
Shares of WLOL climbed as high at $4.50 U.S. in the early parts of 2009 based in part upon the strength of 2008 financial reports. Since that peak, shares have dropped as low as a dime in October 2011. The news is helping drive a climb again as shares have moved back into the area of 50 cents U.S.
Share value was not getting much positive attention Tuesday as the price has slid back to 40 cents with the day winding to a close, but it certainly is more liquid than it was a month ago with a million shares changing hands already today. As the price gimps today, the company appears to be back in motion and may be worthy of a closer look as to what is actually happening. Proper due diligence is encouraged.
