Japanese shipowner Mitsui OSK Lines (MOL) posted JPY 890 billion in revenue figures, operating income of 4.2 billion and net income of JPY 11.5 billion, a drop of 45% year-on-year.
MOL said that this was a year-on-year worsening in the company’s business performance despite an increase in sales.
Its containership business recorded a loss of JPY 10.8bn for the six month period of 2014 financial year (April-September).
The figures from the same period last year amounted to a loss of JPY 3.7bn.
“Although cargo volumes from Asia to North America and to Europe were firm on the back of economic stability in Europe and the US, cargo volumes to China and other Asian countries showed weak growth. On the North-South routes, the freight market experienced a substantial downswing due to a slump in cargo volume, particularly in cargo bound for the South America east coast,” MOL explained.
MOL’s dry bulk business posed revenue increase 4.5% to JPY 418bn, nevertheless the company’s operating income was down almost 31% to JPY 16.5bn.
During the said period dry bulk market showed a sluggish growth due to the slowdown in Chinese economic growth and weak market conditions.
The VLCC market was weak until mid-June but conditions recovered only to weaken in mid-August again. LPG market was strong, according to MOL.
MOL expects an increase in bulk carrier cargo volumes in the winter season due to seasonal factors and gradual upswing in the market due to improvement in balance of supply and demand.
“We assume that there will be an upswing in very large crude oil carrier and product tanker markets going into the winter period,” MOL sain in the market outlook for the rest of 2014 financial year.
Looking at LPG Carrier market conditions, MOL said that the usual slump is expected to be limited in 2014 amid heightened vessel demand in line with an increase in cargo from the U.S.
“With respect to containerships, we will reduce the frequency of services on major routes in line with a slump in cargo volume in the winter season, and work to improve results by continuing to implement slow steaming and push ahead with cost reductions,” MOL added.
The company projects revenue of JPY 1,810 billion, operating income of JPY 28 billion, ordinary income of JPY 50 billion and net income of JPY 40 billion.
1 USD = 109.376 JPY