SINGAPORE: Ocean Network Express (ONE) almost hit its target for
profitability in the second quarter of its fiscal year, which ended 30
September, posting a positive result of $121m.
Thus, after six months, ONE is in the black to the tune of $126m,
earned on revenue of $5.98bn. It said cost reductions and the fall in
bunker prices had mitigated the impact of a drop in liftings due to
“US-China trade issues and a deterioration in the supply-demand balance
in the European trade”.
In terms of liftings, ONE’s biggest tradelane, headhaul Asia-North
America, saw a utilisation level of 94% in Q2 and an overall 90% load
factor for H1 at 1.44m TEU.The carrier’s second largest tradelane,
Westbound from Asia to Europe, recorded a utilisation level of 95% in
Q2,
for a cumulative 91% for H1 at 947,000 TEU.
However, the outlook is rougher weather for the carrier. ONE said it
now expected to report a loss of $66m on its trading in the second half
of the year and, as a consequence, had downgraded its full-year profit
forecast by $30m, to $60m.
It said this was a reflection of an expected deterioration in spot
rates and concerns over a further slowdown in the global economy.
The forecast also assumes that the additional costs for compliance with
IMO 2020 will be recovered in full by its OBS (One Bunker Surcharge)
mechanism, adding that its “customers’ awareness” of the regulatory
compliance was increasing.
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