According to IHS, NYK blamed a ¥10Bn loss in investment securities for revised figures.
Addressing company employees at an event this week celebrating 127 years of service, NYK’s president Yasumi Kudo said that first half fiscal year results were expected to be solid in the car carrier division supported in part by a recovery in exports from Japan and Thailand.
“[A]utomotive sales have been steadily increasing in Asia and the emerging nations,” said Kudo, “[so] we need to focus more resources on expanding our auto logistics business in these regions which is also the scope of ‘More Than Shipping’, including businesses such as ro-ro terminals, pre-delivery inspection facilities and inland transport.
However, he said there were concerns that European demand for freight transport could decline even further during the second half of the year. He added that future prospects for increases in seaborne cargo volumes looked “dim” and the company would have to step up cost reduction measures focused mainly on fuel costs and efficiently deploying the fleet.
The company said in August that it was decreasing planned investment in its container and car carrier fleets under its medium-term management plan, “More Than Shipping 2013,” which aims to diversify further into value-added services and higher margin activities relative to shipping, including logistics and freight forwarding.
In other markets NYK has also been hit by “disastrous circumstances” in the dry bulk carrier division.
“The majority of capesize bulkcarriers newly constructed by the company were built on the assumption of gaining long-term contracts,” said Kudo “However, due to a drastic decline in cargo movements, the number of new vessels and medium-term chartered vessels without such contracts has increased.
Discussing the economy more generally Kudo said that the outlook in the US remains fragile despite signs of recovery in consumer spending, industrial production and capital investment.
“In Europe, economic growth is expected to be negative as weaker economies seek to address budget deficits in an austere economic and uncertain Euro climate,” he added.
Kudo began his address to the company by expressing “deep regret” for the company’s involvement in the recent investigation into suspected antitrust law violations, which a number of international trade associations are conducting. NYK is one of a number of global shipping companies involved in the investigation into an alleged cartel set up to coordinate price hikes for transporting vehicles and other cargo from Japan to Europe, the US and other Asian markets.
CSAV, Mitsui OSK Lines, K-Line. Eukor Car Carriers and WWL are amongst the other forwarders under investigation by the Japan Fair Trade Commission, US government authorities and the Competition Office of Canada.
“As a company, we are cooperating fully with the investigations,” said Kudo.