200809 Grindrod Rainbow.photo supplied

Johannesburg - Grindrod, a South African freight company, is seeking commodity-haulage contracts outside its home market to help offset a decline in shipping that reduced first-half profit by a almost third.

“We are looking at big projects, very capital-intensive projects” in neighbouring countries, chief executive Alan Olivier said by phone from Johannesburg today.

“They will have to open up. Grindrod is keen to participate.”

While South Africa is investing about 210 billion rand in infrastructure to boost the transportation of commodities including iron ore and coal, neighbouring countries are hampered by poor railway networks.

Durban-based Grindrod plans to invest in Mozambique, Zimbabwe and Zambia, the continent’s second-largest producer of copper, according to Olivier.

Grindrod earnings per share excluding one-time items slumped 32 percent to 0.52 rand in the six months through June, the company said today in a statement.

Revenue rose 22 percent to 4.4 billion rand.

The interim dividend was set at 13.6 cents, down from 20 cents a year earlier.

“Shipping earnings haven’t been good,” Olivier said.

“We’ve had a relatively slow start.”

The Baltic Dry Index, a measure of commodity shipping costs, has declined 53 percent this year.

Grindrod shares fell as much as 3.8 percent, the most since August 1, and traded 2.6 percent lower at 24.58 rand as of 10:51 am in Johannesburg.

The stock has declined about 12 percent this year, compared with an 11 percent gain in the FTSE/JSE Africa All Shares Index.

Grindrod co-manages Mozambique’s biggest port in the capital, Maputo.

Goods haulage at the facility rose 19 percent to nine million metric tonnes in the half year, Olivier said, led by a “very good demand” for magnetite and coal.

Last year, transportation was disrupted by the collapse of a bridge. - Bloomberg News