Kintetsu World Express Net Profit Plunges 36.6 Percent

Kintetsu World Express Net Profit Plunges 36.6 Percent

Kintetsu World Express, Japan’s second-largest international forwarder, said its net profit tumbled 36.6 percent in the first nine months of fiscal 2009, which started in April, to $35.64 million.

KWE’s group operating revenue totaled $1.67 billion in the April-December period, down 32 percent from the same nine-month period of 2008. The company’s group operating profit came to $59.31 million, down 33.8 percent from a year earlier.

The Americas accounted for 13.3 percent of KWE’s global operating revenue between April and December, down from 14.7 percent a year earlier, and 16.8 percent of the company’s global operating profit, down sharply from 26.1 percent a year earlier.

The Tokyo-based company attributed the poor financial results to the global slump in demand for both air and sea cargo services.

“Moderate improvements were seen in some parts of the world, thanks to governments’ economic stimulus measures. But the global economy as a whole remained weak without making a full-fledged recovery,” KWE said in its earnings release.

“The Japanese economy continued to be on a recovery path, buoyed by increased exports and industrial production. But a self-sustaining recovery could not be confirmed because of excess labor and production facilities and sluggish consumer spending,” KWE said.

KWE left unchanged its group revenue and profit forecasts for the whole of fiscal 2009, which were announced on Nov.10. The company’s full-year projections are: $2.24 billion in group operating revenue, down 22.4 percent from fiscal 2008; $87.78 million in group operating profit, down 12.5 percent; $50.00 million in group net profit, up 29.4 percent from fiscal 2008.

In fiscal 2008, KWE saw its group net profit nose-dive 62 percent to $38.64 million because of an anti-monopoly fine-related extraordinary charge, as well as repeated hikes in fuel surcharges and a sharp decline in the volume of air cargo.