Ocean carriers NYK and “K” Line reported improved financial results, while MOL’s loss widened.
Japan’s three largest shipping companies — Nippon Yusen Kabushiki Kaisha (NYK), Mitsui O.S.K Lines (MOL), and Kawasaki Kisen Kaisha (“K” Line) — reported mixed financial results for their 2014 fiscal years. All three have a fiscal year that ended March 31, 2015.
NYK
NYK, Japan’s largest shipping company, had a profit in the year that ended March 31, 2015 of 47.59 billion yen ($398 million), a 44 percent increase over the prior year. Revenue was 2.4 trillion yen, up 7.4 percent from the prior year.
“In the shipping industry, while freight movement increased in general, vessel supply pressure remained strongly embedded, mainly with container and dry bulk vessels, and the difficult business environment continued,” the company noted in a statement.
“Nevertheless, advancement of depreciation in the yen during the year and the fall in oil prices provided a boost.”
NYK said it “steadily accumulated profit in our stable-freight-rate business on the back of the many long-term contracts that we have secured, while at the same time continuing rationalization in vessel deployment and fleet adjustment to reduce operation and navigation costs in the non-stable-freight-rate business as well as continuing efforts toward improving business efficiency and cost reduction.”
In the container liner business, NYK had a profit of 9.8 billion yen in the year that ended on March 31 compared with a loss of about 700 million the prior year.
Liner revenue was 696.3 billion yen, up 12.8 percent over the prior year.
”Although overall lifting volumes increased, supply pressure was strong due to completion and delivery of ultra-large container ships, mainly on European routes, and market conditions were weak. On Transpacific routes, demand transitioned favorably due to the strong U.S. economy, the impacts of which were also relatively positive on freight rates.”
But NYK added “the effects of the port congestion that occurred on the west coast of North America resulted in reductions in voyages on the back of schedule delays as well as additional costs.”
NYK expanded cooperation under the G6 Alliance in the transpacific and transatlantic routes during the fiscal year, enabling further consolidation and enhancement of its service network.
“In Asia, we reorganized routes in order to improve service competitiveness. We also reorganized West African routes and routes from east coast ports in North America to South America to consolidate and revise the service network,” the company said.
“We expect the weak yen and lower fuel prices to be a larger factor in driving overall performance next fiscal year compared to this fiscal year. In the container shipping business, we expect weak market conditions as excessive vessel supply capacity continues with completion and delivery of large vessels, mainly on European routes.”
MOL
MOL reported a profit of 42.36 billion yen ($352 million) in the fiscal year that ended March 31, 26 percent less than the 57.39 billion yen reported the prior year. Revenue was 1.82 trillion yen for the fiscal year, a 5 percent increase over the prior year.
The company’s container business had a loss of 24.1 billion yen in the most recent fiscal year compared with a loss of 14.5 billion yen the prior year. Revenue in the container business was 789.1 billion, a 10.5 percent increase over the prior year.
The company said the dry bulk market was hurt by weak growth in cargo of iron ore from Brazil and lower coal imports in China.
In the container market, deliveries of large contanerships remained substantial and kept freights rates low.
“K” Line
“K” Line said it had a profit of 26.8 billion yen ($223 million) in the fiscal year that ended March 31, 2015, a 61 percent increase compared with the 16.6 billion yen earned the prior year.
Revenue was 1.35 trllion yen in the most recent fiscal year, up from 1.22 trillion yen.
The company’s container shipping business reported a 20.6 billion yen profit in the most recent year compared to 100 million yen loss the prior year. Container revenue was 677.4 billion yen, a 16.3 percent increase.
“K” Line said its overall container cargo volumes increased 4 percent and were up 6 percent on Asia-North America services.
“Freight rates remained stable, mainly on the Asia-North America service, and with the effect of falling fuel oil prices, the group recorded a year-on-year increase in revenues for the fiscal year, and income went into the black,” the ocean carrier said in a statement.
