NYK has slumped to a first half loss of JPY 9.7bn ($86.5m) and expects its performance for the full-year to deteriorate further.
The company, like its rivals Mitsui OSK Lines (MOL) and K Line, continued to be impacted by the difficulties at Ocean Network Express (ONE).
Revenue for the quarter was down 14% year-on-year to JPY 915.6bn. While it posted an operating loss of JPY 4.2bn.
“Synergistic effects of the business integration have emerged steadily,” said NYK. “On the other hand, liftings and utilization dropped due to the impact of teething problems immediately after the commencement of services in April of this year.
“ONE sought to regain lost ground during the peak season from July to September, but liftings and utilization remained lower than the outlook because the negative impact remained on its main Asia-North America and intra-Asia routes.”
Looking ahead, NYK is forecasting a full-year loss of JPY 6bn from earlier forecasts of a JPY 12bn profit due to ongoing problems at ONE.
“Although the service disruptions have already ended, the drop in volumes and slot utilization ratio have not fully recovered, and the results are expected to significantly deteriorate,” it said.
However, it said most of the one-time costs required to terminate its container shipping business have already been recorded in the first quarter are now expected to greatly decline in the second half of the year.
