In International Shipping News 07/10/2016
Japanese shipping line Nippon Yusen warned it would book an extraordinary loss of about $1.9 billion in the second quarter, forced by a deep slump in the shipping market to write down the value of container ships and other assets.
The huge writedown is the latest sign of a slowdown in the container shipping sector due to low freight rates and oversupply and comes after the collapse of South Korea’s Hanjin Shipping Co Ltd.
It also said it may revise its full-year financial forecasts, including its dividend, adding it would announce any revisions on Oct. 31 when it reports first-half earnings.
NYK Line, which was founded in 1885 and counts Mitsubishi Heavy Industries as a major shareholder, said it would book an impairment loss of 160 billion yen as well as provisions for losses of 35 billion yen related to contracts.
“Although the market is projected to recover in the first half of the fiscal year ending March 31, 2017, market indicators have not reached anticipated levels.” NYK Lines said in a statement.
The company said it had been selling off or returning surplus vessels and had been scrapping ageing vessels, while adding that its subsidiary would take a loss on aircraft sales and lease contracts.
Source: Reuters (Reporting by Naomi Tajitsu; Editing by Edwina Gibbs)
