MOL back in black, but owes much to cost-cutting in stagnant markets

By Finance

The biggest ocean carrier in JAPAN and owner of the sunken container ship MOL Comfort, Mitsui OSK Lines (MOL), has released its quarterly net profit of JNY14,5 billion (US147,5 million), drawn on revenues of JPY411,9 billion, up 8,7%, thus reversing itself from a net loss of JPY5 billion in the corresponding quarter last year.

Despite the dramatic accident, the company of MOL expects net profit in the 1st half of fiscal year 2013 to increase to JPY20 billion, and revenue to rise up to JPY840 billion with complete fiscal year earnings coming in at JPY50 billion as revenue hits JPY1,7 trillion.

In its container ship segment, the MOL spokesman stated: “Cargo volumes of Asia-Europe routes still remain weak, while there was an expansion in deliveries of large container ships. Freight rate levels fell as a result. Freight rate levels also weakened on other main routes, which reflect a stronger perception of oversupply.

“Even though the loss was recorded in this container ship segment for the 1st quarter there was a year-on-year progress due to redoubled efforts to decrease operating expenditures and improve operational efficiency,” MOL added.

Of the ro-ro segment, MOL stated: “Exports of completed cars from Japan were decreased year on year for each consecutive month of 2013. This reflected continuous stagnation in the European market and the shift of Japanese car producers towards local production for local consumption as part of moves to step up such production,” according to the MOL statement accompanying the results.

Despite experienced recoveries in the 1st quarter of the US and Japanese economies, Europe still remains beset by a recession, and there was a widening trend towards slower growth in emerging countries that also includes and China, MOL added.

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