Wednesday, August 5, 2009

NYK to raise money through bonds

The Journal of Commerce reports

NYK Line said today it will issue two sets of unsecured $315 million bonds in a public offering on Aug. 11 to raise cash for its operations.

The first bond issue, which is named Unsecured Straight Bond No.28, has a five-year maturity and an annual coupon of 0.968 percent.

The second, Unsecured Straight Bond No. 29, has a 10-year maturity and bears an annual coupon of 1.782 percent.

NYK said both bond offerings have been rated AA by two Japanese rating agencies, the Japan Credit Rating Agency and Rating and Investment Information.

These are not paying that much interest, especially for something which is unsecured.
However, they will be sold in the Japanese market, so perhaps there are some tax advantages.

I'm a little surprised by the rating, since they lost so much money recently, are projecting a loss for the full year, and probably next year too.

NYK lost $262.7 million for the first quarter of its fiscal year ended June 30, compared with a profit of $610 million a year earlier. Group revenue for the three-month period fell by 41 per cent during the quarter, down to $4 billion from $7.1 billion a year earlier, as the financial crisis cut into volumes and freight rates.

The largest Japanese shipping line revised its forecast for the full year to a loss of $52.5 million, from an earlier forecast of a $190 million profit, with total revenue of $17.9 billion.

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