Yusen Logistics's net profit plunged 59.2 percent in its fiscal first quarter ending June 30 from a year earlier to $6.1 million on a consolidated basis despite a significant boost in revenue.
The Japanese forwarder's group operating revenue jumped 83.2 percent in the April-June quarter from the same period last year to $981 million. Yusen's group operating profit sank 53.6 percent to $9.96 million.
“In the first quarter, supply chain disruptions and other problems stemming from the Great East Japan Earthquake caused manufacturing production to slow down sharply, and the volume of freight handled in Japan and Asia decreased significantly,” Yusen Logistics said.
However, Yusen Logistics, the the logistics arm of Nippon Yusen Kabushiki Kaisha (NYK Line), didn't give an explanation as to why it suffered sharp drops in both operating and net profits despite the large increase in operating revenue.
In the Americas, Yusen Logistics posted a group operating revenue of $246.6 million in the April-June period, a more than five-fold increase from $44.7 million a year earlier.
The company posted a group operating loss of $2 million in the Americas in the April-June period, down 16.3 percent from the same period a year ago.
Yusen Logistics also said it revised downward its group revenue and profit forecasts for the whole of fiscal 2011, which had been announced April 28.
“In the second quarter, the private consumption-led recovery of US and European economies are expected to lack robustness, and the outlook for the physical distribution market is expected to remain uncertain,” the company said.
Yusen Logistics said with the impact of the Japanese eartherquake less severe in the second half of the year, it expects a pick-up in freight movement in Japan and the rest of Asia. The company said the outlook for U.S. and European econmies is uncertain, largely because unrest in North Africa and Middle East could raise the price of oil.
“In North America, where the company handles many imports from China and other Asian countries, the volume of freight handled in the retail sector is partly influenced by U.S. domestic consumption, allowing no room for optimism about the prospects for a recovery in the logistics business,” the company added.
The company’s new full-year projections are: $4.3 billion in operating revenue, up 110.2 percent from fiscal 2010; $115.5 million in operating profit, up 81.9 percent from fiscal 2010; $47.4 million in net profit, up 2.2 percent from fiscal 2010.
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