Singapore-based Neptune Orient Lines (NOL) recorded a full-year net loss of US$419 million in 2012, a 12 percent improvement over the net loss of $478 million the preceding year, as it focused on cost cutting, fleet renewal, and expansion of its logistics business.
In a statement, NOL said the 2012 net loss was mainly due to a first-quarter setback of $255 million and one-time charges of $108 million. Its 2012 revenue increased 3 percent to $9.5 billion.
The global container shipping and logistics group also reported a 75% improvement in its fourth quarter performance in 2012.Core EBIT (earnings before interest and taxes) loss for the period amounted to $69 million from the $277-million loss year-over-year.
APL, the group’s liner shipping business, improved its 2012 core EBIT loss to $279 million from $446 million in 2011. It shipped 3.02 million 40-foot-equivalent units last year, a 1 percent growth in volume, with a smaller and more efficient fleet. APL reduced its fleet capacity by 8 percent and total fuel consumed by 10 percent during the year.
APL Logistics, NOL’s supply chain management business, reported record revenue of $1.6 billion last year, up 11 percent from 2011. Its fourth quarter 2012 core EBIT stood at $26 million, up 34 percent from the same period last year. It had a full-year core EBIT of $67 million, down 2 percent compared to the preceding year.
NOL saved some $504 million in costs last year, which was in line with its target, primarily through reduced fuel consumption, improved network efficiency, and increased terminal productivity.
“General market conditions in 2012 remained challenging. But thanks to our focus on increasing efficiencies throughout the group, we are in a better competitive position than before,” said CEO Ng Yat Chung.
For 2013, Ng expects the company to perform better as the global economy continues to improve. But he also acknowledges the difficulties ahead for the container shipping industry, foremost of which is the severe oversupply that is causing “considerable container freight rate uncertainty.”
Despite these challenges, he said the group was starting 2013 on a “stronger footing” with its cost reduction program, modern fleet, and more efficient processes.
Photo courtesy of NOL