The Japanese shipping operator NYK Line warned about extraordinary losses in second quarter amounting to 1.9 billion USD, due to sustained downturn in container and dry bulk shipping markets. The additional losses of the company include impairment loss of 1.5 billion USD plus provision for contracts losses of 336.9 million USD. The mentioned losses were not previously included into the forecasts for the interim and full-year consolidated financial results, but carrier prefer not have similarly pessimistic approach to its dry bulk and container shipping business, reassessing the outlook for the markets.
“Although the market is projected to recover in the first half of the fiscal year ending March 31, 2017, market indicators have not reached anticipated levels”, said NYK Line in official statement. “In that light, NYK Line has reassessed its outlook for the market from a conservative perspective, and, as a result, deemed it necessary to record an impairment loss as well as a provision for losses related to contracts in connection with its container ships”, adds the statement.
Since the extraordinary losses are eliminated in consolidation, it will not impact the consolidated profits and losses. They will also affect the dividends payment of the company, which will be announced before October 31. The company had expected to pay an quarter and year-end dividend of 0.019 USD per share and annual dividend of 0.039 USD per share.
NYK Line is one of the oldest and largest shipping companies in the world, headquartered in Japan.