MITSUI O.S.K., “K” LINE REPORT HALF-YEAR PROFITS

MITSUI O.S.K., “K” LINE REPORT HALF-YEAR PROFITS

MITSUI O.S.K., “K” LINE REPORT HALF-YEAR PROFITS

   Mitsui O.S.K. Lines and Kawasaki Kisen Kaisha, two of Japan’s big three shipping groups, have reported their profit results for the six-month period ended Sept. 30 and warned of uncertainties concerning their business environment.
   Mitsui O.S.K. Lines returned a net income of 7.6 billion Yen ($70 million) on consolidated revenues of Yen 440 billion ($4.1 billion) for the latest six-month period. Operating income was Yen 38.9 billion ($360 million) and ordinary income amounted to Yen 28.6 billion ($265 million).
   “K” Line posted a net income of Yen 1.2 billion ($11 million) for the April-September period, on consolidated revenues of Yen 275 billion ($2.5 billion). Ordinary income amounted to Yen 14 billion ($133 million) and operating income was Yen 20 billion ($184 million).
   Neither shipping group provided comparative figures for the year-earlier period. “K” Line said it did not previously have accounts for consolidated half-year results.
   Mitsui O.S.K. forecasts that it will post a full-year net income of Yen 8.5 billion ($80 million) for the financial ending March 31, virtually the same as the Yen 8.3 billion result in the previous year. Consolidated revenues are expected to reach Yen 890 billion ($8.4 billion), compared to Yen 882 billion in the previous financial year. Ordinary income is forecast to increase to Yen 46 billion ($434 million), from Yen 29 billion.
   “K” Line predicts a full-year net income of Yen 2.5 billion ($24 million) for the financial year ending March 31, down from Yen 6.8 billion in the previous fiscal year. Consolidated revenues are forecast to reach Yen 550 billion ($5.2 billion), compared to Yen 486 billion in the previous year. Ordinary income would amount to Yen 26.5 billion ($250 million) for the current financial year.
   “Against a global economic picture clouded by soaring fuel prices, the threat of interest rate hikes and the high cost of crude oil, there is little cause for optimism regarding the company’s current operating environment, particularly in the overseas shipping segment,” a spokesman for MOL said.
   Because of its uncertain operating environment, MOL said it will pay no interim dividend.
   “K” Line will also omit the payment of an interim dividend and said that oil prices were hiked, once again, towards the end of the first half of its financial year. “Under such circumstances, the company continued to endeavor developing businesses positively on the one hand and practicing further cost reductions and rationalization of the company’s whole activities on the other hand.”
   Both MOL and “K” Line reported steady volumes in their container shipping activities, which account for about half of their group revenues. MOL said cost reductions, efficiency gains and increased shipment volumes from Asia led to higher earnings in its liner business.
   NYK, Japan’s biggest shipping group, is expected to announce its half-year results in the next few days.