Major Japanese shipping companies reduced operating loss forecasts for current financial year

NYK shipThe major Japanese shipping companies – NYK, MOL and K Line, operating loss forecasts for current financial year against the background of the stabilization on the world market of container traffic and the weakening of yen. Nippon Yusen Kaisha (NYK) reduced the operating loss forecasts for the current fiscal year (ending on March 31) to 17 billion JPY (about 150 million USD), compared to 25.5 billion JPY expected earlier. Mitsui OSK Lines (MOL) expects a loss of 8 billion yen, against 15 billion JPY projected earlier. Kawasaki Kisen (K Line) reduced forecasts for operating loss from 44 billion JPY to 43 billion JPY, but company remains in worst situation among all the carriers.

The report on the results of the last quarter of NYK sees positive changes in the market of container and dry bulk transportation. However, MOL has reduced the net profit forecast to 7 billion JPY to zero, indicating the continuing crisis on the market.

The accumulated loss of the carriers NYK, MOL and K Line for period October-December 2016 amounted to 1.4 billion JPY, compared to 6.3 billion JPY an year ago. In total the three major Japanese shipping companies operate a fleet of more than 2,000 vessels, including tankers, bulk carriers and container ships.

In October last year, the three companies announced their intention to combine their container operations to confront the crisis and overcapacity in the industry. As a result of the merger, which is scheduled for April 2018, it will create the sixth largest container line in the world, as the combined fleet of the operator will be 265 vessels with total capacity of 1.38 million TEU. Nippon Yusen will receive 38% of the operator, Mitsui OSK and Kawasaki Kisen will have share of 31%.