Neptune Orient Lines (NEPS.SI), the world's fifth largest container shipping firm, reported a wider-than-expected fourth-quarter net loss but said business conditions have improved. 

The company, around two-thirds owned by Singapore state investor Temasek Holdings (TEM.UL), has cut staff and reduced  capacity over the past 15 months to cope with weaker cargo  volumes, but it said demand is gradually returning. 

 

“There have been improvements in volumes and asset  utilisation in NOL's principal markets. In addition, freight  rates have stabilised and trended upwards in some trades,” NOL  said on Thursday. 

 

“If these conditions continue, better business performance is possible. However, significant risks remain, particularly the  sustainability of demand and higher fuel costs,” the firm added. 

 

NOL still expects to post a loss in the first half of 2010 despite the improvement in business conditions, CEO Ronald  Widdows said at a news conference. 

 

NOL reported its fifth straight quarterly loss, incurring a deficit of US$211 million ($298 million) for October-December 2009 compared with  a net loss of US$149 million a year ago. 

 

The fourth-quarter result was worse than the Thomson Reuters I/B/E/S consensus estimate of US$106 million. 

 

NOL competes with global shipping companies including Maersk, a unit of A.P. Moller-Maersk Group (MAERSKb.CO),  Germany's Hapag-Lloyd (HPLG.UL) and Taiwan’s Evergreen Marine. 

 

According to Thomson Reuters data, analysts expect NOL to post a 2010 net loss of US$146 million.