NOL reports improvement in 1Q 2014 Core EBIT
NOL Group has narrowed its Q1 2014 loss US$65 million from a year ago, and showed a 14% improvement in its first quarter Core EBIT (Earnings Before Interest, Taxes and Non-Recurring Items), the Company said Wednesday in a press release.
The Group posted a first quarter 2014 net loss of US$98 million, compared to a US$76 million profit in the same period last year which included a US$200 million gain from the sale of the NOL headquarter building in Singapore.
The Group also reported positive Core EBITDA of US$33 million this quarter, compared to US$5 million in the same period last year. NOL attributed the improvement to its continuing focus on cost management and operational efficiency, which delivered US$80 million worth of cost savings in the first three months of 2014.
APL, NOL’s container shipping business, lifted its 1Q 2014 Core EBIT by 10% over the same period last year, recording a loss of US$83 million. Cost savings and efficiency gains helped reduce cost of sales per forty-foot-equivalent unit (FEU) by 6%. APL reported first quarter 2014 revenue of US$1.9 billion, while its year-on-year volume grew 2%, and its average freight rates dipped 6%.
APL’s headhaul utilisation was at an optimal 95% in the first quarter of 2014. APL registered a 9% volume expansion with stable freight rates in the Asia-Europe trade. Volume was firm in the Trans-Pacific trade with freight rates falling 5%, while its Intra-Asia trade grew 1% in volume against an 11% dip in freight rates, amidst intense market competition and excess tonnage cascading from the Asia-Europe trade.
NOL’s supply chain management business, APL Logistics, made a year-on-year Core EBIT improvement of 13% in the first quarter of this year, which reflected its continuing focus on profit optimisation. Its revenue of US$423 million was relatively unchanged from that of the same quarter last year.
In 1Q 2014, revenue from Contract Logistics was steady at US$271 million, with Core EBIT rising 13% year-on-year to US$9 million. At the same time, International Logistics Services’ revenue remained stable at US$152 million, with Core EBIT going up 13% year-on-year to US$9 million. APL Logistics’ expanding business in emerging markets helped to offset persistent sluggish demand in developed markets which slowed down overall industry growth. Its continued focus on cost discipline also improved the company’s operating performance.
Neptune Orient Lines (NOL) is a Singapore-based global container shipping and logistics company. Its container shipping arm, APL, provides world-class container shipping and terminal services, as well as intermodal operations supported by leading-edge IT and e-commerce. Its logistics business, APL Logistics, provides international, end-to-end logistics services and solutions, employing the latest IT and data connectivity for maximum supply chain visibility and control.