APL BOOSTS NOL’S FIRST-HALF RESULTS
Soaring operating profits from its APL liner business helped Singapore-based Neptune Orient Lines triple its operating profit before depreciation and interest costs for the first half of the year, to $244 million.
The result compares with an operating profit before depreciation and interest costs of $81 million in the first half of 1999.
Excluding non-recurring gains, operating profit rose to $53 million in the first six months, from a loss of $96 million in the year-earlier period.
Group net after-tax profit increased 613% to $49 million in the first half of 1999. Higher operating profits more than compensated for the absence of exceptional profits in the latest six-month period. In the first six months of last year, NOL recorded exceptional profits of $104 million due mainly to capital gains on the sale of the APL stacktrain business.
Group revenue was $2.19 billion in the first six months of this year, up 8 percent from the $2 billion revenue figure for the same period last year. Excluding the APL stacktrain revenue in 1999, group revenue was up 22 percent.
All businesses of the NOL group recorded improved operating results for the first half of this year, but the bulk of the profit increase came from APL’s liner business.
APL’s container shipping arm had earnings before interest and tax of $97 million, compared to a loss of $9 million in the first half of 1999. Revenue from container shipping jumped 24 percent, to $1.81 billion, from $1.46 billion. Container carryings increased 16 percent, to 675,000 FEUs. Average freight rates rose 2 percent, to $2,441, from $2,386 in the year-earlier period.
APL’s logistics activities reported 17 percent higher earnings before interest and tax of $14 million, and a 22-percent increase in revenue, to $203 million.
Flemming Jacobs, president and chief executive officer, said NOL was able to post significant growth despite rising fuel prices. “Of course there is an impact from the higher bunker prices, but they don’t make or break our performance,” he said.
NOL expects a “significantly better” net group result for the year, compared to the results in 1999.