News / ONE profits plunge, thanks to weak rates and front-loading

Photo: Dreamstime.com

Ocean Network Express (ONE) has reported a net loss of $88m for the third quarter of fiscal year 2025, as weaker freight rates and oversupply continued to pressure the container shipping market on the carrier side. 

The Japanese carrier’s Q3, spanning October to December, generated revenue of $4.07m – a sharp deterioration in profitability, with total revenue down 16% year on year, and 9% down from Q2.  

Its total liftings were unchanged year on year, underperforming broader market growth of around 5%, as indicated by Container Trades Statistics (CTS) data. 

EBIT turned negative at -$84m, down from $282m in Q2. EBITDA also declined significantly, to $536m, compared with $881m in the prior quarter. 

Source: ONE

The carrier said the results were driven primarily by a persistent increase in vessel supply and slower cargo movement, particularly on the Asia-North America tradelane. It said cargo volumes on this route slowed following heavy front-loading in the first half of the fiscal year, leading to a year-on-year decline in short-term freight rates.  

Meanwhile, Asia-Europe cargo flows initially stagnated during the quarter, but showed a gradual recovery toward the latter part of the period, it said. 

Average revenue per teu declined 16% year on year, though this was less severe than the global average decline of 21%, as shown in CTS data. But despite a decrease in volumes, the carrier revealed profit per load had improved due to changes in cargo mix. 

While overall volumes in the quarter were subdued, ONE said it expected a recovery in demand in Q4, alongside a modest uptick in freight rates. 

CEO Jeremy Nixon said: “Our Q3 FY25 results reflect a challenging operating environment as we continue to navigate the complexities of the current global landscape.

“Although market dynamics impacted our performance during the quarter, we remain focused on disciplined capacity management, cost control, and ongoing network optimisation to enhance operational resilience,” he added.  

On the cost side, bunker prices declined year on year, offering some relief, however, overall operating costs increased due to higher vessel-related expenses and port charges, offsetting any fuel savings. 

ONE’s outlook assumes vessels will continue routing via the Cape of Good Hope while the situation in the Red Sea remains under close review.  

It said expected a “modest uptick” of rates in Q4 and a recovery of the “subdued” volumes it saw in Q3.