MOL’s net income climbs 568% in two years

MOLÆs net income climbs 568% in two years    Tokyo-based carrier MOL reported $914.9 million in net income on revenue of $10.9 billion for the fiscal year ending March 31, in its annual report issued Tuesday.
   Net profits rose 77 percent over the previous year, and revenue climbed 17 percent. In the past two years, net income has climbed 568 percent from $136.9 million, which the company credits to long-term growth planning a decade ago and strong demand in all ocean transport categories.
   Between 2004 and 2007, MOL's fleet of vessels will grow from 645 to 750, including 145 new vessels. Another 142 vessels are planned to be added by 2010, raising the total fleet to nearly 900. Roughly 70 percent of the fleet will be involved in the transport of energy and natural resources.
   Revenue needed to fund the purchase of 287 new vessels in six years will be provided by 'consistently high cash flows from high earnings and substantial depreciation,' the report said.
   In the fiscal year ending in March 2006, for instance, the company expects operating revenue of $1.45 billion.
   In a message to shareholders, Chairman Kunio Suzuki and President Akimitsu Ashida wrote: 'The scale of these investments naturally raises questions about demand growth. We believe the long-term outlook for ocean transport demand is highly favorable. There is no doubt the ocean transport market has entered a new phase. In many categories, notably LNG and refined product tankers and iron ore bulkships, there is virtually no danger that strong market conditions will spark excessive growth in supply, as has occurred repeatedly in the past. The reason is that demand is being fueled by structural, long-term trends while the ability to increase supply is limited.'