ONE expects ‘further improvements’ in meeting bottom line

He said “Having overcome the teething problems of operation, ONE is now at the stage where it can achieve more synergy through best practices and expect further improvements in meeting the bottom line.”

Looking back on 2019, he said “effort and execution” was made in driving a turnaround of ONE, recovering the fleet’s cost competitiveness through structural reforms and improving profitability in its car carrier business. Mr Myochin said “As a result of these efforts, as well as efforts to accumulate profits based on our medium and long-term contracts and reduce operating expenses, we were able to achieve more progress in the first half of the year than originally planned.

“Unfortunately, during the three years of our medium-term management plan starting in FY2017, financial indicators fell short of target due to factors including structural reforms in response to unexpectedly poor market conditions and a temporary deterioration in the bottom line caused by the teething problems of ONE’s first year of operation.”

Mr Myochin continued “However, we were able to steadily improve the foundations of our business in preparation for next steps, such as by rebuilding our business portfolio and introducing a business risk management system. We have progressed as planned in the current fiscal year - let’s all work together to ensure the remaining fourth quarter finishes well and achieve profit in the black for the full year.”

In April, the company will launch a new medium-term management plan. Although specific details of the plan are still under discussion, there will be no change in K Line’s “core philosophy of facing customers head-on and providing high-quality services that meet their needs”.

Mr Myochin explained “Our ability to grasp these customers’ needs and respond by providing unique value and services will be a key theme in our efforts to continue being our customers’ first choice.” He said the pillars supporting this theme are safety, environment, and quality.

Moving on to compliance with the tightened regulation on emissions of sulphur oxides that began this, he said “As stated in the company’s Environmental Vision 2050, we announced the construction of an LNG-powered car carrier at the end of last year. We also announced our participation in an LNG fuel supply business in Singapore with Shell and the launch of a joint venture in the Chubu Region. However, we cannot reach IMO’s 2030 targets by simply switching from diesel oil to LNG fuel; we must continue to study new technologies as ’LNG+’, such as the self-flying energy kites announced last year that utilise wind power.”

Furthermore, to reach its 2050 goals, K Line will accelerate research in alternative fuels such as ammonia, methane and hydrogen.