APL declares US West Coast a potential risk factor

The longer term impact of the drop in container freight rates is uncertain for NOL’s container shipping business APL (Singapore)

NOL Group (Singapore) last week reported a fourth quarter 2014 core EBIT (Earnings Before Interest, Taxes and Non-Recurring Items) loss of USD 17 million, a year-on-year reduction of 79%. On a full year basis, the group posted a core EBIT loss of USD 76 million and a net loss of USD 260 million.

The group also improved its core EBITDA in the quarter, bringing it to US$ 92 million compared to USD 7 million in the same period last year. Singapore-based NOL attributed this to its continuous focus on operational efficiency and rigorous cost management. The group recorded USD 430 million worth of cost savings in 2014.

“In spite of challenging conditions, especially on the US West Coast, our container shipping arm reduced its operating losses, delivering a year-on-year improvement in core EBITDA, reflecting the progress made in its cost and efficiency drive. At the same time, our logistics business continued to grow, expanding its capability and presence in key growth markets,” said NOL Group CEO Ng Yat Chung.

“While we are seeing some benefits from the current trend of lower bunker prices, the longer term impact of the drop in fuel price on container freight rates is uncertain. More port congestion, resulting from further deterioration in the labour situation on the US West Coast, is a potential risk factor,” he adds.

APL, NOL’s container shipping business, narrowed its year-on-year core EBIT loss by 64% to USD 37 million in the fourth quarter, attributing it to its efforts to manage costs and increase operational efficiencies. APL cut back its fleet capacity and enhanced cargo selection to improve its operating performance. Volume fell 8% in the quarter over the prior year as a result of capacity management and fewer sailings in the Transpacific services calling Southern California as US port congestion continued.

“Southern California port congestion arising from trucker shortage and chassis issues, among others, negatively impacted both our cost and service levels in the second and third quarters of 2014. Congestion on the US West Coast due to ongoing labour negotiation hampered our operational ability in the fourth quarter,” said APL President Kenneth Glenn.

The NOL Group’s container shipping business APL has been facilitating global trade since 1848. It offers more than 80 weekly services and over 500 weekly calls at 160 ports worldwide.

www.nol.com.sg

Quelle: LogEastics
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