NOL sees profit fall 84%

Singapore - Neptune Orient Lines (NOL) said year-on-year net profit dropped of 84% in 2008. In the fourth quarter alone, NOL suffered a net loss of US$149 million.

The container shipping and logistics group said net profit for fiscal year 2008 stood at US$83 million, an 84% decline from 2007. The group's earnings before interest and tax was US$213 million in 2008, down 64% from the previous year.

In the fourth quarter 2008, the Singapore-based company posted a net loss of US$149 million, compared to a net profit of US$196 million a year ago.

Ron Widdows, president and CEO of NOL said in the statement the results confirm the impact of a severe market downturn in the latter part of 2008, caused by reduced consumer confidence and significant restructuring costs.

"Since late September 2008, we have seen a constant week-by-week drop in shipment levels across nearly all trade routes," Widdows said.

NOL announced in November it would post an operating loss for the fourth quarter.

The company has since axed about 1,000 employees and shifted its US headquarters from Oakland, California to Phoenix, Arizona in a cost cutting exercise.

"Though we recognised early the pattern of decline in market conditions, and took decisive action to reconfigure our business, the adjustments could not fully counter the speed and dramatic nature of the downturn being experienced in global container trades," said Widdows.