Neptune Orient Lines Ltd., Asia’s second-biggest container line, posted a better-than-estimated fourth-quarter profit as rebounding global trade boosted rates and volumes.
Net income was $177 million in the three months ended Dec. 31 compared with a loss of $211 million a year earlier, the Singapore-based company said today in a stock exchange statement. The shipping line was expected to post a $75 million profit based on the average of four analyst estimates compiled by Bloomberg. Sales rose 37 percent to $2.8 billion.
The company’s container volumes grew 13 percent as economic recoveries in the U.S. and Europe drove up demand for furniture, clothes and electronics made in Asia. The shipping line and larger rival Evergreen Group also ordered new vessels last year as demand rebounded following the end of the global recession.
“Volumes have held up better than earlier expected amid growing demand from major economies,” said Um Kyung A, an analyst at Shinyoung Securities Co. in Seoul. “The shipping lines also have become more prudent in managing capacity.”
Neptune Orient’s APL Ltd. unit carried 829,000 40-foot equivalent containers in the fourth quarter, according to the statement. Average revenue per box climbed 24 percent to $2,757. The unit’s sales rose 40 percent to $2.4 billion.
Demand growth may slow this year after a post-recession surge in 2010, Chief Executive Officer Ron Widdows told reporters in Singapore. Shipping lines may able to slow more vessels to curb capacity amid the weaker growth and to offset rising fuel prices, he said.
“There will be some moderation in growth in overall trade,” Widdows said. Global container trade may expand 9.7 percent this year, after jumping 13.5 percent in 2010, according to Clarkson Plc, the world’s biggest shipbroker.
NOL, controlled by state-investment fund Temasek Holdings Pte, gained 1 percent to close at S$2.13 in Singapore today before the earnings announcement. The company has risen 29 percent in the past 12 months, compared with a 12 percent gain for the city-state’s benchmark Straits Times Index.
The shipping line has the capacity it needs for this year and it isn’t due to receive any new vessels in the period, Widdows said.
The company is scheduled to accept 10 ships next year, 10 in 2013 and two in 2014. It placed orders for 12 ships valued at about $1.2 billion last year.