After suffering massive losses over the past year, and with more losses forecasted amid terrible drybulk and tanker markets, Mitsui OSK Lines’ President Koichi Muto has announced drastic measures will be taken to bring the company back to profitability.
By 31 March 2014, 70 ships, consisting of 50 dry bulkers and 20 tankers, will be either sold or scrapped in order to reduce the fleet size to 120 dry bulk carriers and 60 tankers.
This move is a continuation of measures taken in the second-half of 2012 when 15 dry bulkers and 4 tankers were sold or scrapped. An additional 5 tankers were sold for scrap at the end of January 2013.
Mr. Muto notes that this move will generate a huge loss, and will cost the company over USD $1 billion to execute, however he comments,
“We can expect a significant improvement in profits, including about ¥40 billion during FY2013. We will improve profits in dry bulker and tanker free tonnage operations, which have eroded our overall business performance, aiming at a return to profitability on and after FY2013.”