P&O Nedlloyd Results: Second Quarter 2003.

Business Editors

LONDON--(BUSINESS WIRE)--Aug. 14, 2003

The attached information sets out the financial results, trade statistics and key points for P&O Nedlloyd Container Line for the second quarter 2003. In general terms it shows that:

In Q2

-- P&O Nedlloyd achieved an operating profit for the quarter of

$11 million before restructuring costs compared to a loss of

$46 million in Q2 2002;

-- Volumes were 4% higher than Q2 2002;

-- Average revenue per teu improved by 11% on Q2 2002 and by 5%

on Q1 2003; and

-- $300 million annualised cost savings have been achieved so far

in 2002/03.

Outlook

-- Despite the strength of the Euro and continuing high fuel

prices, the balance of supply and demand in the industry is

expected to remain favourable for the foreseeable future,

creating an increasingly positive outlook.

Further information:  Andrew Lincoln, Manager, Investor Relations
                      and Strategy, P&O (020 7321 4490)

                      Victoria Moth, Corporate Communications
                      Manager, P&O (020 7321 4593)

                      Leon Albers, Manager, Investor Relations,
                      Royal Nedlloyd (0031 10 400 6911)

                      Cor Radings, Corporate Public Relations,
                      Royal Nedlloyd (0031 626 316 854)


                         RESULTS & STATISTICS

                                     Q2      Q2    Year to   Year to
                                    2003    2002     Date      Date
                                                     2003      2002
----------------------------------------------------------------------
Throughput (teus)
----------------------------------------------------------------------
    Europe/Asia                   297,000 287,500   590,700   551,300
----------------------------------------------------------------------
    North/South & Cross Trades    344,300 332,900   661,600   617,700
----------------------------------------------------------------------
    North America                 291,900 278,700   562,300   521,800
----------------------------------------------------------------------
Total                             933,200 899,100 1,814,600 1,690,800
----------------------------------------------------------------------
Average revenue per teu             1,250   1,131     1,224     1,139
----------------------------------------------------------------------
Revenue                             1,166   1,017     2,221     1,926
----------------------------------------------------------------------
Operating profit/(loss) before
 interest and tax (before
 restructuring costs)                  11     (46)      (45)     (112)
----------------------------------------------------------------------
Restructuring costs                    (4)    (15)       (6)      (17)
----------------------------------------------------------------------
Operating profit/(loss) before
 interest and tax (after
 restructuring costs)                   7     (61)      (51)     (129)
----------------------------------------------------------------------
Net profit on sale of fixed assets      0      10         0         6
----------------------------------------------------------------------
Interest, minorities and other
 items                                (12)    (10)      (23)      (22)
----------------------------------------------------------------------
Profit/(loss) before tax               (5)    (61)      (74)     (145)
----------------------------------------------------------------------

Notes to editors :

1. Teu = twenty foot equivalent unit. This is the standard size of container and is a common measure of capacity in the container business.

2. All financial figures are US$ million except average revenue per teu which is US$.

3. It is important to note that a change in average revenue per teu does not necessarily equal a change in profit contribution. Average revenue per teu is calculated equally across all trades and products. It makes no allowance for cargo mix, relative volumes on different trades or additional elements which are raised and paid for in local currency.

KEY POINTS

1. The $11 million operating profit for Q2 2003 (before restructuring costs of $4 million) represents a substantial improvement in P&O Nedlloyd's performance compared with both Q2 2002 (a loss of $46 million before restructuring costs of $15 million) and Q1 2003 (operating loss of $57million before restructuring costs of $1million);

2. The key feature of the result is the continuing positive trend in average revenue rates which were 5% up on Q1 2003 and 11% up on Q2 2002. These increases have been assisted by bunker surcharges and the effect of currency movements. Rate increases continue to be achieved on the high volume Europe Asia Trade. The rate negotiations on the Transpacific trade were successfully concluded in May.

3. Volume growth of 4% was achieved compared to Q2 2002. This was lower than average world trade growth during the period due to a slow down in certain trades, such as Latin America and Inter Asia;

4. Despite higher operating costs generated by the strength of the Euro and bunkers the company has achieved $300 million in annualised cost savings in 2002/3. Further substantial savings will follow next year with the full implementation of new global processing and information systems; and

5. The continuing growth of world trade, coupled with the upward trend in revenue rates, points to a positive outlook for the second half of the year, although the strength of the Euro, high fuel prices and charter rates continue to increase some operating costs.