Yusen Logistics’ Profit Plunges Despite Revenue Growth

Yusen Logistics’ Profit Plunges Despite Revenue Growth

Major Japanese international freight forwarder Yusen Logistics Co. said that its group net profit plunged 38.9 percent in the first three quarters of fiscal 2013, which started on April 1, 2013, from a year earlier to ¥913 million (US$8.95 million) despite a big jump in operating revenue.

The Tokyo-based company saw its group operating revenue surge 22.1 percent year-on-year in the April-December period to ¥303.5 billion. Its group operating profit also soared 57.4 percent to ¥3.5 billion.

The company’s nine-month group net profit sank, apparently due to a big decline in extraordinary gains, which shrank to ¥286 million from ¥1.3 billion a year earlier.

Yusen Logistics is the logistics arm of Nippon Yusen Kabushiki Kaisha (NYK Line), Japan’s largest shipping firm by sales. Yusen Logistics is one of the nation’s three largest international freight forwarders, along with Nippon Express Co. and Kintetsu World Express Inc. (KWE).

Looking back on the first three quarters of the current fiscal year, Yusen Logistics said in an earnings release, “The Japanese and U.S. economies were on a recovery trend, led by consumption.”

“But the European economy remained stagnant. Economic growth in other Asian countries also slowed down as inflation rose there due to the weakening of local currencies,” Yusen Logistics said.

On the international logistics market, Yusen Logistics said that its sea cargo volume “grew firmly, especially in Asia.” The company also said that its air freight volume “showed signs of having bottomed out but had yet to make a clear recovery” in the April-December period.

In the Americas, Yusen Logistics saw its group operating revenue rise 24.5 percent in the first nine months of fiscal 2103 from a year earlier to ¥69.2 billion, but its group operating profit dropped 4.2 percent to ¥113 million.

Yusen Logistics left unchanged its initial group revenue and profit forecasts for the whole of fiscal 2013, which were announced on April 30, 2013.

The company’s full-year projections are ¥400 billion in operating revenue, up 18.0 percent from fiscal 2012; ¥4.5 billion in operating profit, up 171.3 percent from fiscal 2012; and ¥1.5 billion in net profit, up 34.1 percent from fiscal 2012.