SINGAPORE's Neptune Orient Lines (NOL) has announced a net loss of US$91 million for the third quarter compared to a profit of US$282 million in the same period last year.
The group said its APL Logistics business reported higher revenue and a nine per cent year to date gain in operating profit, but container shipping dragged down overall results.
"The liner shipping industry is faced with slowing trade demand, excess capacity and fuel costs that are significantly higher than a year ago," said CEO Ng Yat Chung. "Our urgent priority is to drive down costs and increase efficiency."
NOL reported third quarter revenue of US$2.2 billion, down nine per cent from a year ago. It announced an operating profit loss for the period of US$72 million. In the first nine months, NOL's net loss stood at US$158 million.
APL, the liner shipping business of NOL, reported increased volume of seven per cent in the third quarter of 2011. Revenue declined 12 per cent and the business announced a Core EBIT loss of US$88 million. Revenue per FEU was 19 per cent lower in the third quarter of 2011 compared to the same period in 2010. Fuel prices increased 45 per cent in the third quarter from the same period a year ago.
"Higher volume was offset by increased fuel cost and lower freight rates," said APL president Kenneth Glenn. "In this environment, we must continue to concentrate on operational efficiency and managing costs down."
APL Logistics, NOL's supply chain management business, reported third quarter revenue of US$333 million, up 10 per cent from a year ago. Third quarter operating profit stood at US$16 million, down 11 per cent from a year ago. In the first nine months, APL Logistics has reported revenue of US$1 billion, up 15 per cent from 2010.
"We achieved our highest average weekly revenue ever during the third quarter and we continue to invest for growth," said APL Logistics president Jim McAdam. "But at the same time, we are actively managing costs as a reflection of uncertain economic conditions."
The group said that global economic conditions have not improved and with continued low freight rates in container shipping and slowing trade demand, it expects to report a loss for the full year in 2011.
picture: google.com / source: shippinggazette
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