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Strong first quarters push up NYK-"K" Line profit forecasts

Strong first quarters push up NYK-"K" Line profit forecasts

Tokyo: Leading Japanese shipping companies Nippon Yusen Kaisha (NYK) and Kawasaki Kisen Kaisha ("K" Line) have increased their profit forecasts following strong results for the first quarter of this fiscal year (April 1-June 30, 2007).

NYK Line posted consolidated revenues of 601.3bn yen ($50.5bn) as compared to 524.7bn for the same period last year. It saw an operating income of 39.3bn yen (22.5bn yen last year), income before extraordinary items of 44.5bn yen (22.3bn yen), and net income for the quarter of 28.6bn yen (12.3bn yen).

In a statement, the company said, "Consolidated revenues climbed 14.6% compared with the same period last year. This reflected revenue growth in the shipping segment, composed of liner trade and other shipping, due primarily to an expanded fleet size and increased volumes of cargo handled, as well as sales increases in the logistics, terminal and harbor transport, and cruises segments."

The company also cited a limited increase in costs and expenses, growth in interest and dividend income and equity in earnings of unconsolidated subsidiaries and affiliates and gains on the sale of vessels as reasons for the boost to net income.

Accordingly, NYK now anticipates a net income of 100bn yen for the year ending March 31, a 22% increase on the previously predicted 82bn yen.

"K" Line saw a similar surge, with profits reaching 25.8bn yen for the period, up from 9.7bn yen in 2006. It also saw sales climb 23% to 309.2bn yen. Accordingly, the company has increased its forecast from the previously predicted 63bn yen to 71bn yen.

It is worth noting that both companies have raised their estimates for fuel prices, which may eat away at profit margins.  [27/07/07]