Japanese shipping company Mitsui O.S.K. Lines (MOL) reverted to profitability in fiscal year 2018, unlike its partners in the ONE alliance.
MOL delivered a profit of JPY 26.8 billion (USD 242.1 million) in fiscal year 2018, compared to a loss of JPY 47.3 billion posted a year earlier.
Operating profit rose to JPY 37.7 billion in FY 2018 from JPY 22.6 billion seen in FY 2017.
Revenues dropped to JPY 1.2 trillion in FY 2018 from JPY 1.65 trillion reported a year earlier.
The increase in the company’s profit was attributed to a relatively firm market in addition to stable profit, mainly by the dry bulk and energy transport businesses.
This was despite a significant deficit in the containerships segment stemming from operational teething problems of ONE and the transitional costs, as explained by MOL.
In the dry bulk segment, ordinary profit increased by JPY 6.5 billion to JPY 21.9 billion in FY 2018.
The company’s energy transport business also saw an overall rise in ordinary profit, driven by profit increases in both the tanker and LNG carrier/offshore businesses. The overall profit grew by JPY 7.5 billion to JPY 21.1 billion in fiscal year 2018.
On the other hand, the product transport business suffered a loss of JPY 12.2 billion in FY 2018, compared to a loss of JPY 6.3 billion reported a year earlier. It was affected by a loss of JPY 14.3 billion in the company’s containerships segment.
For fiscal year 2019 ending March 31, 2020, MOL expects to deliver a net profit of JPY 40 billion (USD 363.6 million).
The forecast reflects a range of factors including a softening of markets mainly for dry bulkers in comparison with the previous year as well as expectations for a significant improvement of the containership business.