MOL lowers operating profit forecast

Mitsui OSK Lines (MOL), with the world's biggest merchant fleet, has lowered its operating profit forecast by 25 per cent for the year ending March 31, from the previously announced US$843 million to $527 million.

The company posted a first-quarter loss of $137 million as sales fell 41 per cent to $3.1 billion, hurt by falling shipping rates and weakening demand for cargo vessels, reported Bloomberg.

The Baltic index, a measure of commodity-shipping rates, fell 72 per cent in last quarter. The index averaged 2,714 points in the three months ended June 30, compared with 9,751 points in the same three-month period a year earlier.

"The company expects deterioration of freight rates, stagnation of cargo trade mainly for containerships, and a delay in the recovery of completed car exports, along with a substantial rise in bunker prices. In the third and fourth quarters, the company anticipates that the external conditions will not reverse," said MOL.

Source: Transportweekly