JAPANESE shipping giant "K" Line is back in the black, declaring a net profit for the three quarters ending in December 31 of US$82.2 million, after a year-on-year loss of $54.5 million in 2016. Profit in 2017 was drawn on revenues of $7.8 billion, up 16 per cent.
Container shipping revenues were up 20.1 per cent and accounted for nearly half the sales made in the nine-month period. with dry bulk shipping taking up most of the other half.
The global economy continued to be steady on the whole despite rising geopolitical tensions in some regions, said the "K" Line statement accompanying the results.
"The US economy stayed firm against the backdrop of continued favourable employment and income environments. As capital investment continued to grow due to a recovery in foreign demand and improvement in corporate earnings, the economy kept expanding," the statement said.
"Meanwhile, the European economy grew at a moderate pace as private sector consumption maintained relative high growth and exports remained firm in the euro zone despite a slowdown of the UK economy," it said.
"In China, the pace of economic growth slowed because the increase in industrial production decelerated as a result of monetary tightening and strengthening of environmental regulation.
"Emerging economies stayed strong because of such factors as the recovery of the economies of resource-rich countries due to a resource price rise, an improvement in the Indian economy and a pickup in domestic demand in ASEAN countries," said the "K" Line statement.
The only sombre note in "K" Line rosey assessment, was the continuing sorry state of supply and demand.
"Supply-demand balance did not improve, freight rates remained top-heavy. As a result, the containership business lacked strong momentum even in the busy season ahead of the Chinese national day holiday," said the statement.
News was good from its dry bulk business as the market continued to recover owing to continued strong steel product demand in China in the Cape-size sector and robust cargo movements of grain and coal in the medium and small vessel sector.
"In addition to the structural reforms carried out in the previous two fiscal years to enhance competitiveness, the group implemented measures to improve its profitability, including continued cost reduction and improvement of vessel allocation efficiency" said the statement.
"K" Line's cumulative handling box volume in dominant legs grew one per cent year on year in the Asia-North America services and around 14 per cent in the Asia-Europe services.
Handling volume increased 10 per cent in the intra-Asia services due to robust cargo movements but declined 3 per cent in the North-South services.
"Although freight rates did not rise to the initially expected level, overall handling volume, including in return legs increased around four per cent year on year, reflecting robust cargo movements," the statement said.
Source: SchednetPrevious Next