NYK PREDICTS LOSS FROM CONTAINER SHIPPING IN 2001/2002 FISCAL YEAR

NYK PREDICTS LOSS FROM CONTAINER SHIPPING IN 2001/2002 FISCAL YEAR    Japan’s NYK group reported that its container shipping business has deteriorated rapidly in recent months and will suffer a loss in its current fiscal year ending on March 31.
   “Indications are that for the full fiscal year, a huge deficit cannot be avoided since the profit earned in the first six months will not suffice to offset the expected loss in the second half of the year,” NYK said.
   NYK is believed to be the first shipping line to have forecast annual losses from container shipping, in sharp contrast to the record profits posted by most container shipping lines in 2000.
   The Japanese group said that the worsening results from its container business was the result of the weakening of the global economy and the shrinking of consumption in the U.S. and Europe following the terrorist attacks in the U.S.
   “If the simultaneous recession worldwide should deepen further, there could arise a worse situation in which all our business divisions suffer a devastating slump at the same time,” NYK warned.
   To head off such a situation and attain numerical profit targets, NYK must recognize that it is “in a crucial period” and “lower the break-even point as much as possible” by eliminating fat and reinforcing profitability, a spokesman said.
   NYK is in the process of implementing a medium term corporate plan called “Project C Phase-1.”
   The parent company of the group intends to ask all group members and subsidiaries to participate in “Project C Phase-1,” and to draw up and implement plans for boosting the ordinary profit for fiscal 2002 as soon as possible.
   In implementing the plan to boost ordinary profit, it will become imperative to thoroughly develop business in the container division, the group said. With regard to other sectors, NYK said that it has “great expectations” from the further development of business in the tramp/specialized carrier division, including car carriers, and expects further efficiencies in the management of passenger ships and management of the entire NYK group.