NYK merges logistics divisions

It blamed the decline in performance on lower volumes during the first half of the fiscal year, caused by the global recession.

But in the second half, cargo movements gradually picked up and, against a backdrop of firm economic growth in emerging economies such as China, there was a marked trend of recovery in distribution volumes in the Asian region.

“We expect continued growth in cargo movements in Asia, and anticipate gradual expansion in distribution volumes in the Americas and Europe, where the recovery had been delayed,” NYK said.

The group said it had minimised the effects of the recession through cost-cutting exercises such as consolidating warehouses and reducing overheads.

To improve the fortunes of the logistics division, it plans to merge the two operations, calling the new entity Yusen Logistics, by March 2012.

NYK said: “Through the merger, we will establish a system for the comprehensive proposal of logistics services covering ocean, land, and air. We will also make full use of synergy effects resulting from the merger, such as increased operational efficiency.

“We will endeavour to increase volumes in ocean freight forwarding, which we will position to complement the liner trade.”

NYK’s container shipping line also saw revenue decline, down 36.5% to ¥378 billion, and reported an operating loss of ¥51.7 billion.

It put the declines down to volume and rate declines, but said things improved in the second half.

To improve the situation, said the company, NYK Line will use fewer of its own ships and increase the number of chartered vessels it uses.

This will make it easier for the carrier to match supply and demand.

It aims to reduce the number of vessels it owns from the peak of 120, recorded in 2008, to 60 by 2015.

Source: IFW