NYK chief Naito sets out growth targets

Formation of new boxship venture will be felt across the group, but NYK president has clear plans for other divisions.

NYK is looking for growth in the LNG and cruiseship markets after a sluggish 2016 for the industry that saw the Japanese company cut its dividend for the first time in over half a century.

President Tadaaki Naito is also seeking developments in the car carrier business and stable income from the company’s tanker activities, he told investors today.

In his New Year speech, Naito said 2016 marked a turning point for the NYK Group, with large losses and substantial fall in its share price.

“We need to be fully aware of the fact that shareholders are very troubled with our decision to not pay a dividend for the first time in 52 years,” he said.

While preparing for the merger of its boxship operations with rivals MOL and K Line “will have major impact on the entire group”, Naito laid out changes and challenges for other areas of the group’s maritime business.

Cruise order coming?

Twenty-sixteen marked the 25th anniversary of NYK ordering its first cruise ship and the president sees the sector offering “a path for future expansion”.

“I would like to ask everyone concerned in the cruise business to make a thorough study of the new business and the possibility of constructing a new ship, and produce relevant results that can be used in the future,” he said.

In the car carrier arena, the president called for relevant divisions to reorganize shipping routes "with a fresh understanding of customers’ needs and to boost efficiency without being constrained by previously accepted practices".

Energy plans

The LNG sector will see another round of new business in various African countries from 2020, Naito said.

“Therefore, I want us to prepare for that next wave of growth with fresh ideas and awareness gained from our past experiences,” he explained.

Elsewhere in the energy division, Naito said market trends were well established with the LPG, crude and chemical operations expected to grow as divisions that can secure stable freight rates.

For dry bulk, which experienced record-low rates last year, safe and reliable transportation was now being recognised in the market, with the boss calling for “creative solutions” to help NYK stand out.

Naito also set a goal for the company’s terminal business to become more competitive and stressed the logistics operation will be more strategically important.