APL posted core earnings before interest and taxes of $7 million in the second quarter, the carrier’s first profitable quarter since the end of 2010, as parent NOL Group cited improved freight rates and cost cuts.
Singapore-based NOL reported a group-wide second quarter core EBIT of $16 million, compared with a year-earlier loss of $43 million. One-time charges, largely for a restructuring that eliminated several hundred jobs, produced a net loss of $118 million, compared with a year-earlier net loss of $57 million.
“The one-time charges were difficult but necessary,” said CEO Ng Yat Chung. “We need a more efficient organization and a more modern, cost-competitive fleet to deal with the oversupply situation in the container shipping industry.”
Without the $112 million in one-time charges, NOL’s second quarter net loss would have been $6 million.
APL’s revenue rose 7 percent to $2 billion in the first quarter. The carrier’s volume rose 4 percent to 720,000 40-foot-equivalent units. Average revenue per FEU rose 3 percent to $2,615.
The carrier cut empty-container repositioning costs by $19 million in the first half of 2012.
NOL said that through two quarters of 2012 it has achieved $225 million in expense reductions toward a full-year goal of $500 million.
Improved fuel efficiency accounted for much of the cost savings, the company said. NOL said it cut fuel use 7 percent in the first half of this year, despite a 4 percent increase in cargo volume.
APL Logistics, NOL’s supply chain management business, reported second quarter core EBIT of $9 million as revenue rose 15 percent to $361 million.
NOL offered a cautious outlook for the rest of the year, saying its financial performance “will depend on freight rates, global economic position, overcapacity in container shipping and fuel prices.”