Profile: James Kidwell, FD of Braemar Seascope

James Kidwell, Braemar Seascope’s finance director is, himself, robust
looking and direct in his manner: his appearance is coincidentally every inch
the traditional image of a naval officer. He has, however, spent his life on dry
land and in finance.

Starting out, as many FDs before him, as a trainee accountant at what was
then Price Waterhouse in the 1980s, he now steers Braemar’s finance function.

Since Kidwell’s appointment the company has experienced remarkable growth. In
2002, when he joined, the company was reporting revenues of £25m and losses of
£3m. Today, it is generating turnover of £58m and profits before tax of £10m.

Unchartered waters

Shipbroking is an unusual and curious trade, involving the sale and
repurchase of ships themselves, as well as, more commonly, the chartering of
ships. Braemar’s 300 or so staff spend much of their time connecting those who
want to transport things with the owners of the ships.

In markets where the cost of such services is uncertain, Braemar’s services
are no doubt invaluable. The business’s global reach means there’s no limit to
trade. ‘Shipping has become, always was, completely international. The focus of
our brokers’ attention is on the client, located all around the world,’ he says.

China and India are particularly important, where there are major charterers
and also major owners. ‘One of the interesting things for me in this job has
been the need for us to spread our wings geographically. When I joined we had an
office here and in Aberdeen. We were totally UK based. Over the past few years,
the shipping market has boomed and it has been very important for us to increase
our presence particularly in the Far East.

The company has established offices in Shanghai and Beijing, another in India
and also in Australia and Singapore. ‘Singapore has tax advantages for ship
owners. Increasingly, our clients are moving there.’

Sunset industry

It’s a surprise in some respects to find a business in the shipping arena
still thriving in the UK today. The shipbuilding industry has, for some years
now, been referred to as a ‘sunset’ industry in Britain, suffering gradual
decline as the business moves elsewhere.

But Kidwell points to the continued importance of London as a historic
maritime centre. The Baltic Exchange, the former trading floor for shipbrokers
that continues to provide information and light regulation of the industry, is
one reason.

The insurance industry and the legal aspects of shipping are another major
draw. Scanning through High Court case lists and looking at the backgrounds of
many UK commercial barristers only underlines that. The list of important cases
that have taken place in London is endless. ‘London is an important part of
shipping. Many of the skills around law and insurance are here. London is
trusted among clients for those skills.’

Time on his side

Timing is also something that Kidwell has on his side. ‘Shipping throughout
the 1990s was a very, very weak market.’ Shipbrokers depend on the rates at
which freights are traded at, since they take a percentage of any deal, and with
so many ships and comparatively fewer cargos at the time, the rates were driven
down. ‘There was too much tonnage,’ is Kidwell’s technical description.

Now, however, the outlook is more favourable for new entrants. Many ships
built in the late 1980s have since been scrapped, he says, suggesting there’s
more in the market for the likes of Braemar. ‘It is more in balance since 2000
and there has been a much greater amount of volatility.’

That, in turn, means a demand for brokers, who can provide expert guidance on
freight rates amid an uncertain marketplace. There are also global developments.

‘Freights are rising – demand for oil and raw materials has been steadily
growing. Seaborne trade is a critical factor, 90% of freight by weight is still
carried by sea. Seaborne freight is growing by 4% to 5%. Leaving aside the
fleet, that’s a nice backdrop.’

The company is also diversifying to both provide a hedge against the ups and
downs of the shipping market and to ensure revenues in something other than the

‘We believe that if we can find other shipping service areas and we can
understand them and there’s a degree of overlap it’s sensible for us. We’re
quite highly geared to the shipping market.’

To that end, a few years back, Braemar bought Cory brothers, the shipping
agency. Shipping agents help ship owners to look after their ships in port, with
things like Customs clearance. The company also bought Wavespec, a company that
provides technical support for ship owners, particularly when they are building
ships in a yard.

‘At least 80% of shipbroking revenues are conducted in dollars. We have a
rolling programme of hedging using forward currency contracts,’ he says,
illustrating a key challenge for him as the FD, as well as by way of explaining
the diversification.

Evolutionary process

Another challenge Kidwell faces at Braemar is the degree to which the
company’s stock was held internally by its brokers and managers. A significant
70% of the company was owned internally and it has been an ‘evolutionary
process,’ he says, to diversify the shareholder base.

‘The liquidity of our shares was low. One of the objectives was to build our
share register both in terms of bringing in new financial institutions and
interesting new collections of private investors. Along with the chief executive
we have conducted a programme of shareholder meetings twice a year,’ says

Often, the best way of attracting new shareholders is when retirees chose to
sell some of their holdings. If institutions are interested in acquiring a block
of shares, Kidwell looks to opportunities internally.

Kidwell says that he enjoys the international aspect of his work. ‘The
international side of the job is very interesting, partly because as a
relatively small company we get a very interesting window on the world and
global trade. I also do travel a fair bit to our overseas offices.

‘It’s also an industry that still retains much of the sense of fun in
business. It hasn’t gone completely on an electronic platform. Client contact is
still very critical.’

The company’s goals retain Kidwell’s interest for the present time. ‘There’s
an awful lot that Braemar can achieve. We can expand into other shipping
services. We can expand our broking geographically. Those are the immediate

‘Beyond that it’s difficult to say. It may well be that Braemar [in a few
years] is much larger. Quite likely there will be new challenges. In the longer
term, however, like many FDs today, he considers a broader role achievable.
‘Longer term it would be very nice to think there might be a company where I
could be chief executive.’


Kidwell started as an auditor at Price Waterhouse in the 1980s (and indeed
the link remains as PwC audits Braemar today).

He left in the late 1980s to join Carlton, which was at the time just a media
business, prior to its acquisition of the London ITV franchise. He held several
jobs there, working with David Cameron – a brush with fame that may become more
useful in coming years, perhaps.

‘David Cameron was a very capable individual who was extremely bright. He
introduced a lot to the investor relations profile that Carlton had,’ Kidwell
He used to work with Cameron in particular on the company’s annual report. It
was the new Tory leader’s responsibility, with Kidwell handling the numbers at
the back.

Cameron had a reputation at the time among financial journalists for being
slippery and evasive. Did he experience that side of him?

‘I can’t comment. He may well have been, but that was not his internal
He left Carlton in 2001 just prior to its merger with Granada to become ITV.

He became interim FD at the classical music publishers Boosey & Hawkes.

‘I Joined Boosey & Hawkes as it was being bid for too, helping the board to
deal with that sale process.’

By 2002, however, ‘It was far from clear what the future held at Boosey
& Hawkes and when I was offered the job here in shipping I was interested to
take it.’

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