K Line is now expecting to make a profit in the first six months of its fiscal year due to the rebound in boxship demand.
The Japanese shipowner and operator's new forecast for the six months to 30 September calls for net earnings of ¥8bn ($76m), compared to a loss of ¥3.5bn predicted in August.
The actual result was ¥16.3bn in the same period of 2019.
The revenue forecast is unchanged at ¥309bn.
K Line said the expected improvement is based on the performance of its containership business, Ocean Network Express, operated with partners NYK Line and Mitsui OSK Lines.
Profit has risen "due to the effort...to optimise network management, vessel operation and recover the demand by mainly Asia-North America service and Asia-North Europe service".
Fleet to be cut
Tokyo-listed K Line will make a further estimate for the year to 31 March, 2021, "once the forecasts can be rationally estimated."
In August, the shipowner unveiled plans to slash its long-term fixed core fleet by more than 50 vessels over the next five years.
The company will cut at least 20 vessels within the 2020 financial year, with the remaining 30 vessels set to go by 2025.
The outfit was the second major Japanese shipping company to announce cuts to the size of their fleet. In June, MOL said it was cutting 40 vessels, or around 5%, due to Covid-19.
K Line ships facing the chop this year include capesize, panamax and smaller-size bulkers, as well as woodchip carriers, thermal coal carriers and car carriers.
Big hit from pandemic
The owner said it had taken a ¥8bn hit from the Covid-19 outbreak in the first quarter to 30 June.
As a result, K Line reported a first quarter loss of ¥1bn against a profit of ¥7.8bn in the same period last year.
Boxship rival AP Moller-Maersk has already said it expects to earn up to $1.5bn more this year than originally forecast, as "agile" capacity deployment reduces costs.
The group is also predicting Ebitda in 2020 of between $6bn and $7bn, before restructuring and integration expenses.
This week it emerged the Danish group had paid the highest ever charter rate for a larger feedership, fixing a Peter Dohle vessel for $14,950 per day for two to three months in Asia.
