Singapore-based company NOL has posted its fourth quarter earnings of 2014, putting the global shipping and logistics company into its fourth year of losses.
While NOL’s fourth quarter results saw its net loss reduce 38 per cent to US$85m compared to the same period in 2013, the company posted a net loss of US$260m in 2014.
Port congestion on the US West Coast has been cited as one of the major challenges for both NOL and its container shipping arm, APL.
“In spite of challenging conditions, especially on the US West Coast, our container shipping arm reduced its operating losses … At the same time, our logistics business continued to grow, expanding its capability and presence in key growth markets,” said NOL CEO Ng Yat Chung in a company statement. “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.”
NOL’s container shipping subsidiary, APL, saw its fourth quarter volume drop 8 per cent, and its revenue drop 7 per cent to US$1.8bn compared to the same period last year.
“Despite the difficulties, APL performed better year-on-year due to stringent cost management and operational efficiency,” said APL president Kenneth Glenn. “We will maintain our focus on reducing costs, leveraging network efficiencies, and concentrating on yield management in key trade routes. In addition, we have 19 chartered ships scheduled for expiry in 2015 – this will further enhance our cost structure.”
APL Logistics, the supply chain management arm of NOL, recorded a 5 per cent growth in revenue in the fourth quarter to US$458m.