<p>Royal P&O Nedlloyd has turned in a fivefold increase operating profit during 2004, with the promise of more during 2005.</p> <p>Operating profit was US$401m, up from US$77m in 2003, on a 22% increase in revenue to US$6.7bn. </p> <p>Much of the best-ever result was achieved in Asia, with average rates rising 19% over the global average of 13%. But the Australasian trades also performed extremely well for the carrier. </p> <p>The line said that stronger Australasian currencies and reduced competition from relay operators meant that the ANZ Alliance round-the-world services made strong gains in the European trades.</p> <p>The Australasia/US trades "have seen improvement in both directions", the line said, with strong movement of frozen meat to the US, and strong currencies and economic growth in the region. </p> <p>The line said that Australasian demand from Asia remained very strong, with exports from Australia still affected by drought earlier in the year. Extra capacity between Asia and New Zealand, and between north China and Australia, was added during the year. </p> <p>P&O Nedlloyd chief executive Philip Green said that the volume and freight rate outlook remained strong, with negatives in the weak US dollar, congestion at European and US west coast terminals, bunkers, charter rates, and the increasing trade imbalances between Asia and North America/Europe. </p> <p>The line said that costs were US$96 per teu higher than in 2003, of which US$35 was due to the weakness of the US dollar.</p> <p>Mr Green declined to describe the much-improved performance as "good" because the line’s operating margins are still under-performing its leading peers by US$300m or US$80 per teu. </p> <p>There would "be relentless focus on yield management to bridge two-thirds of the gap by the end of this year" after making little impact on the yield gap during 2004, he said. </p> <p>Leading shipping industry equity analyst Mark McVicar of Dresdner Kleinwort Wasserstein is forecasting a result of US$508m for 2005, or up around 20%. This is at the upper end of analysts’ expectations.</p> <br />
