World News
Lower Bunker Prices Help Put K Line in Black in H1 2013
Japanese carrier Kawasaki Kisen Kaisha Ltd. [TYO:9107] (K Line) reports it swung to a profit for the first half of its fiscal year, ended September 30, thanks partly to lower fuel prices.
Revenues rose 11 percent year-over-year to ¥606.6 billion ($6.2 billion), while net income hit ¥14.7 billion ($150.8 million), compared with a loss of ¥1.1 billion for the same period last year.
"Overall, the business environment surrounding the shipping industry remained unstable despite positive factors towards our business performance such as moderation of soaring fuel price," the company said.
The shipping line said the average price it paid for bunker fuel fell to $628 per metric tonne (pmt) for the six months, down from $685 pmt for the same period last year.
K Line reduced its container service on Inter-Asia and North-South service as a result of "streamlining of unprofitable service lines," cutting the number of containers transported on those routes by 20 percent and also reduced Asia-Europe service 9 percent.
While revenues for the containership segment grew 9 percent to ¥298.2 billion ($3.1 billion), net income for the segment dropped 59 percent to ¥1.5 billion ($15.7 million).
"Our earnings deteriorated from the year-ago period despite our aggressive attempt for the improvement of operating efficiency through the deployment of newly-built large energy-efficient ships, and for the cost cutting measures including slow steaming."
The company said the cost-cutting efforts did succeed in increasing earnings in the dry bulk and car carrier segments.
K Line said its net income for the period was 97 percent higher than previously forecasted due partly to better-than-expected cargo shipments to China, smooth operation of the car carrier business, and progress in cost cutting.
Fellow Japanese carrier Mitsui O.S.K. Line [TYO:9104] (MOL) also said falling bunker prices helped it to improved results for the half year.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 504.50 | 2.50 | 620.00 | 3.00 |
| Rotterdam | 456.00 | 1.50 | 621.50 | 2.00 |
| Houston | 476.00 | 7.00 | 624.00 | 1.00 |
| Fujairah | 496.50 | 2.00 | 713.00 | 2.50 |
| Global 20 Ports Average | 526.50 | 0.50 | 712.00 | 0.50 |
| Global 4 Ports Average | 483.00 | 2.00 | 644.50 | 0.50 |
| Global Average Bunker Price | 570.50 | 1.50 | 751.00 | 1.00 |
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