Container Line for the first six months of 2000.

The company, which operates the Oleander, saw net earnings fall by $89,000 or 6 percent to $1.36 million for the first half of the year compared to the same period in 1999.

This decline in profits was despite a $558,000 or 4 percent increase in revenues to $13.4 million, compared to $12.9 million for the same six months last year.

The fall in earnings led to a fall in net earnings per share from 48 cents to 45 cents. Dividends for the six months, however, were up, from 14 cents to 16 cents.

A statement from the ocean freight service said: "The major factor leading to the decline in earnings was a very significant increase in fuel costs directly attributable to the high world oil price. Fuel cost for the BCL more than doubled between 1999 and 2000.'' But the company, which is listed on the Bermuda Stock Exchange, said that the impact of the increase in the price of fuel would be offset by the fuel surcharge implemented in June.

The increase in revenue was partly due to the small increases in container volume for both Bermuda Container Line and the sister company Somers Isles Shipping Ltd (SISL) services and increased breakbulk cargo volume for the SISL service.

The BCL service did experience a decline in roll-on, roll-off volume but this was expected because of the large volume of heavy construction material moved in the first part of 1999.

Revenue also increased through the sale of surplus reefer containers and improved interest earnings.

The company also announced that due to favourable world prices for new containers, the directors at their June meeting approved the purchase of a new fleet of dry containers for $750,000. These containers will replace the old containers by the end of the year. The distinctive new green SISL containers have already been in use at the docks.

Bermuda Container Line has seen its profits nearly double in the last five years. For the six months to June in 1996, net income stood at $754,196, increasing to $925,05 the following year, and jumping to $1.45 million in 1999 for the same six months.

Last year, the company reported near record earnings for 1999 of $3.1 million.

The only year to top that in the 20 years since the company started was 1988.

At the end of the first six months of 1999, BCL president Geoffrey Frith, who also runs Container Shipping Management, Bermuda Agents for SISL and BCL, warned that as the construction projects on the Island wound down, it would affect the volume of shipping contracts dealt with by BCL.