Shipping line Neptune Orient Lines (NOL) group has reported a Q2, 2015 net profit of US$890 million, which includes the sale of its supply chain management business, APL Logistics.
Singapore-based NOL said that Q2, 2015 saw severe freight rate erosion with rates in major trade lanes falling to some of the lowest levels seen in recent years.
Ng Yat Chung, Group President and CEO of NOL, said: “The group’s container shipping business continued to face a challenging environment characterised by over-capacity and weak market demand. Nonetheless, APL reversed a core EBIT loss in the second quarter last year to a positive position this year.
“We remain focused on improving our cost competitiveness, yield optimisation and service reliability to return the liner business to sustained profitability.”
NOL reported US$100 million in cost savings in Q2, 2015, bringing its total cost savings for the first half of the year to $255 million.
Mr Ng said: “There is room for further cost savings with another nine vessels scheduled for expiry in the second half of this year.”
Following the completion of the sale of APL Logistics for a final purchase price of US$1.238 billion, and after taking into account transaction and transaction-related expenses, the NOL Group registered a gain of US$887 million.