[100810.EN.SEA] NOL Quarterly Profit US$ 100 Million After US$ 146 Million Loss

GLOBAL container shipping and logistics group Neptune Orient Lines (NOL) has reported net profits of US$100 million in the second quarter of 2010, up from a net loss of $146 million in the same quarter last year.

Net profit for the first half was $1 million, compared to a net loss of $391 million, according to a statement of company results.

The group's core EBIT (earnings before interest and taxes) for the quarter was $114 million compared to a core EBIT loss of $131 million in the same quarter a year ago. Second quarter 2010 revenue increased 53 per cent to $2.1 billion.

"Continued strong container shipping volumes and improving freight rates helped return us to profitability," said NOL president and CEO Ron Widdows. "The result for this latest quarter reflects significant progress as we turn around our performance from the economic downturn of 2009."

NOL reported core EBIT of $40 million for the first half of 2010, compared to a $353 million core EBIT loss a year ago. Revenue in the first half increased by 44 per cent to $4.2 billion.

APL, NOL's liner shipping arm, that includes the results of its container shipping and terminals businesses, reported first half revenue of $3.7 billion, up 46 per cent over last year.

Volume in the first half increased by 39 per cent to 1.35 million FEU. Core EBIT for the first half was $13 million, up from a core EBIT loss of $372 million a year ago.

"Vessels were effectively full during much of the first half of 2010 even though we reintroduced idled vessels to our network and added incremental capacity," said APL president Eng Aik Meng. "In the second half, we will continue to emphasise operational efficiency and service reliability to meet the needs of our customers."

APL Logistics, NOL's supply chain business, reported core EBIT of $27 million in the first half, up 13 per cent from 2009. Revenue increased 33 per cent to $578 million. The improvement was attributed primarily to increased volume across various business lines, higher rates in the freight forwarding business and growth in the auto logistics sector.

"We are particularly encouraged that average weekly revenue in the second quarter of 2010 was the highest it has been since late 2008," said APL Logistics president Jim McAdam.

With further improvement expected in container shipping volume and rates, NOL said it expects significant improvement in third quarter profits.

Source : HKSG, 10.08.10.