K Line slumps to a $457m full year loss

The JPY51.5bn ($457m) loss for FY2015 compared to a profit of JPY26.8bn profit in FY2014. Revenues in FY2015 also fell to JPY1.24trn against JPY1.35trn in the previous year.

The loss resulted from the restructuring of K Line’s dry bulk business with the company accelerating the rationalisation of its dry bulk fleet focusing on the smaller-to-medium sizes.

For the coming financial year ended 31 March 2017 K Line is forecasting a JPY35bn net loss and expects to record an extraordinary loss from the continued restructuring of its dry bulk business.

Commenting on the outlook K Line said: “In the business environment for the shipping industry, there is concern of a sluggish demand for cargo movement due mainly to marked slowdown of the Chinese economy, weakness in economies of emerging markets accompanying a slump in resource demand, and the effect of uncertainty in the European economy where there is political unrest caused by the refugee issue.

“In addition, with the currently ongoing vessel supply pressure, it’s expected that a certain amount of time will be needed for full-fledged recovery of supply and demand balance and market conditions, which reached record low levels.”