NOL will cut costs of US$500m

NEPTUNE ORIENT LINES     SHIPPING     CONTAINER LINE

Singapore - Neptune Orient Lines (NOL), parent of Southeast Asia's biggest container line, suffered a US$478 million (S$599 million) net loss in 2011, after a profit of US$461 million (S$580 million) the previous year.

The container shipping and logistics company cited unsettled economic conditions, high fuel costs and lower freight rates as reasons for the loss.

APL, the company's liner shipping business, reported a 5% drop from 2010 with revenue of US$7.9 billion (S$9.94 billion). Average revenue per forty-foot equivalent was down 10%.

Ng Yat Chung, group CEO of NOL, expressed his disappointment in the performance of container shipping.

"Overcapacity and higher fuel costs have negatively affected the whole container shipping industry. We are urgently addressing costs and all other factors under our control to improve our performance," he said in a statement.

With the company's losses, Ng announced a plan to cut US$500 million (S$629.4 million) in costs.

Kenneth Glenn, APL president, said the company must continue to drive down costs and make better cargo selection decisions for the future.

APL logistics president Jim McAdam, agreed, saying APL will continue to invest in their business infrastructure and logistics network to support business growth.

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