Neptune Orient Lines (NOL), the parent of containerline, APL, narrowed its fourth-quarter loss to US$75.45 million as the shipping company cut costs amid ongoing weakness in the industry.
For the full year, NOL swung to a net profit of US$707.2 million, or 27.27 US cents per share, from a year-ago loss of US$259.8 million.
Revenue fell 28 per cent during the quarter to US$1.3 billion amid planned capacity cuts, void sailings, weak container trade demand and a challenging freight rate environment.
"The fourth quarter was particularly a difficult quarter for the liner industry as a whole," Ng Yat Chung, group president and CEO said.
But NOL also reduced cost of sales by 28 per cent to US$1.2 billion, while cutting operating expenses by 29 per cent to US$135.6 million.
The liner division, APL, saw its revenue fall 24 percent year-over-year to $5.4 billion, driven down by a full-year drop in volumes of 13 percent to 2.46 million 20-foot-equivalent units and a 17 percent decline in the key metric of average revenue per TEU to $1,887.
In the last quarter, the revenue per box decline was even sharper, falling 22 percent compared to the same three months in 2014, mainly due to a reduction in backhaul volumes out of the U.S. and the Gulf.
The outlook remains subdued. The company said that the outlook remains bleak, as freight rates at still at historic lows and demand remains weak.
"Weak trade growth and overcapacity led to historically low freight rates in major trade lanes in Q4 2015," NOL stated. "Freight rates are expected to remain under pressure. The group will continue its focus on cost and operational efficiencies, as well as yield and network capacity management."