NOL Group narrows Q4 loss as impact of efficiency drive kicks in

Ng Yat Chung, CEO of Neptune Orient Lines, in a photo taken in 2012 at the NOL Building. -- ST PHOTO: ASHLEIGH SIM
Ng Yat Chung, CEO of Neptune Orient Lines, in a photo taken in 2012 at the NOL Building. -- ST PHOTO: ASHLEIGH SIM

Shipping company NOL Group posted a narrower loss of US$85 million (S$115.6 million) in the fourth quarter, compared with losses of US$137 million a year ago.

Revenue fell 5 per cent to US$2.23 billion from US$2.33 billion a year ago, due to a drop in liner revenue from lower freight rates and volume.

The company posted loss per share of 3.29 US cents for the quarter, compared with loss per share of 5.31 US cents a year ago.

NOL chief executive Mr Ng Yat Chung, said: "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."

"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 said.

Due to losses incurred, the NOL board of directors has recommended that no dividends be declared for financial year 2014.

Going forward, in view of the volatility of the container shipping industry, the board said it will decide on dividend payments after taking into consideration the profitability, investment opportunities and the overall capital management plan of the group.