Kawasaki may raise profit forecast

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

30 Apr 2008

Kawasaki Kisen Kaisha Ltd, the only major Japanese shipping line to predict a decline in profit this fiscal year, gained the most in a week in Tokyo on speculation that the company may raise its forecast. Kawasaki Kisen advanced 4.8 per cent to close at 1,111 yen in Tokyo yesterday. The Tokyo-based shipping line expects a drop in profit this year as costs increase faster than sales. Growth in China, the world's largest buyer of iron ore, may spur sales as the country boosts imports of the steel-making ingredient to build more cars, ships and factories.
'Kawasaki has been conservative in its predictions and it may increase its profit forecast this year,' said Mitsushige Akino, who oversees US$468 million in assets in Tokyo at Ichiyoshi Investment Management Co. 'Demand from China and other emerging countries will likely outweigh any slowdown in demand from the US.'
Kawasaki Kisen, also known as K-Line, last week forecast net income will drop 6 per cent to 78 billion yen (S$1.02 billion) in the fiscal year ending March 31, after increasing to a record 83 billion yen last fiscal year, as higher fuel costs crimp profits.
Nippon Yusen KK and Mitsui OSK Lines Ltd, Japan's two largest shipping lines, are also forecasting slower growth in sales, with revenue increasing 4.5 per cent and 5.4 per cent. They predict net income will increase at a slower pace than last year.
Nippon Yusen rose 2 per cent to 1,033 yen and Mitsui OSK gained 1.5 per cent to 1,459 yen.
China's economy grew at the fastest pace in more than a decade and the country's imports of iron ore jumped 17 per cent last year, according to the China Metallurgical Mining Enterprise Association. This year they may reach 435 million tonnes, it said on April 2.

Source: Bloomberg