Despite an expected 25% drop in revenue, Jutha Maritime Plc (JUTHA) is aiming for higher net profit this year than in 2009 as prospects for the shipping industry have improved in line with the global economy.

The SET-listed dry-bulk carrier also expects its shipping operations to return to profitability this year after a loss last year because of the global economic recession, said president Chanet Phenjati.

The sales of three ships out of the company's fleet of eight vessels will cause Jutha's shipping revenue to decline by a quarter in 2010 from 618.5 million baht posted last year, Mr Chanet told a briefing at the Stock Exchange of Thailand yesterday.

"But I believe that the worst is over and we are on track to report a higher net profit than the year before as the global economy and the shipping industry are in recovery mode," he said.

Global gross domestic product (GDP), based on a forecast by the International Monetary Fund (IMF), is projected to expand by about 4% this year and 2011. Global cargo demand typically expands at double the GDP growth rate, which would mean 8% growth this year.

Improving cargo demand is expected to push the Baltic Dry Index (BDI), the major measure of shipping costs for commodities, up to possibly reach 3,000 by the end of this year from 2,600 to 2,700 at present, he added.

In 2009, Jutha's net profit dropped 48.95% to 63.23 million baht (0.75 baht per share) from 123.86 million (1.48 baht per share) as a result of declining freight rates, in line with the world economy, and the disposals of two old chartered vessels.

The company's total revenue increased from 682.4 million baht in 2008 to 696.2 million last year.

Without gains from vessel sales, Mr Thanet said Jutha's shipping operations booked a loss of about 15 million baht last year as shipping revenue decreased by 8.5%.

Jutha sold another ship earlier this year, bringing the company's total owned vessels to five with an average age of seven years. Meanwhile, the carrier has been awarded management contracts for five other ships, meaning Jutha now operates 15 ships altogether, he said.

The management contracts are expected to generate revenue of about $1 million this year, he added.

Shares of JUTHA closed yesterday on the SET at 4.88 baht, unchanged, in trade worth 34,000 baht.