Japanese Three boost 9-month profits

Japanese Three boost 9-month profits    Nippon Yusen Kabushiki Kaisha (NYK Line), Mitsui O.S.K. Lines and Kawasaki Kisen Kaisha Ltd. (“K” Line) all reported strong results for the nine-month period ended Dec. 31, backed by higher freight rates, with profits more than double their full-year earnings for the previous fiscal year.
   NYK, the largest of the three major Japanese groups, had a group net income of 34.5 billion yen ($322 million) in the nine-month period to Dec. 31. This compares to Yen14.3 billion in net income for the fiscal year ended March 31, 2003, and is 235 percent higher than the Yen10.3 billion earnings reported for the nine-month period ended Dec. 31, 2002.
   Mitsui O.S.K. Lines posted a group net income of Yen39.6 ($370 million) for the latest nine-month period ended Dec. 31. It did not provide comparable figure for the corresponding period of 2002. However, Mitsui O.S.K. Lines’ net income for the latest nine-month period is already more than twice the net profit of Yen14.7 billion earned in the full year ended March 31, 2003.
   “K” Line’s group net income for the latest nine-month period amounted to Yen21.7 billion ($202 million). No comparable figure was disclosed for the corresponding period of 2002, but “K” Line’s net income for the latest nine-month period is also more than twice its net profit of Yen10.4 billion for the full year ended March 31, 2003.
   The results point to record full-year profits for the April 2003-March 2004 fiscal year of the Japanese shipping groups.
   NYK’s revenues grew 11 percent to Yen1 trillion ($9.6 billion) in the nine-month period to Dec. 31. NYK attributed the increase to higher volumes and freight rates in its shipping segment, and growth in logistics and terminal operations. Revenue from liner shipping for April-December climbed 17 percent to Yen287.4 billion ($2.7 billion). NYK cited an increase in liner freight rates, tighter supply and “a surge in liner demand, particularly on routes from Asia to North America and Europe.”
   NYK’s operating income rose 20 percent to Yen69.4 billion ($648 million) in the latest nine-month period, despite higher bunker costs and the negative impact of the lower U.S. dollar.
   Mitsui O.S.K. Lines had an operating income of Yen63.2 billion ($590 million) on revenues of Yen737.6 billion ($6.9 billion) in the nine-month period to Dec. 31.
   “In the liner shipping business sector, key east and west routes saw a continuous upward trend that started in the first half of the (fiscal) year,” Mitsui O.S.K. Lines said. It mentioned the “restoration of freight rates on our major routes” and cost cuts resulting from streamlining vessel operations, leading to “sharply improved profits.”
   For its bulk-carrier and specialized carrier divisions, Mitsui O.S.K. Lines reported strong demand for iron ore and coal in Japan, South Korea, and particularly China, with rates in the dry bulk market remaining strong. In the tanker and liquefied natural gas division, the Japanese group said it continued to enjoy stable profits through long-term contracts.
   “K” Line stressed the “remarkable expansion of Chinese exports and imports” for its nine-month results. “Freight markets improved covering all our businesses.”
   For its container shipping operations, “K” Line cited brisk cargo movement and tightened supply/demand balance that “helped advance rate restoration in (the) North America and Europe trades.” The carrier said it increased its cargo volume and raised its operating revenues from container shipping to a significant extent. “K” Line said it improved its operating income from container shipping despite higher bunker costs and the appreciation of the Japanese currency.
   Overall, “K” Line made an operating income of Yen43.6 billion ($407 million) from shipping in the nine-month period to Dec. 31, on revenues of Yen462.4 billion ($4.3 billion). Its operating income from port services and other services incidental to transportation amounted to Yen5.6 billion ($52 million), on revenues of Yen65.7 billion ($613 million).