Hapag-Lloyd's Loss Widens

Joseph Keefe
Tuesday, May 13, 2014

Company says freight rates remain under pressure; blames tough competition, weak U.S. dollar. Pins hopes on G6 alliance, container merger with CSAV.

German shipping company Hapag-Lloyd's first-quarter loss widened as its revenue declined, hit by tough competition which depressed freight rates and a weak dollar.

Shipping groups have been struggling through the worst slump on record, as they grapple with low freight rates caused by overcapacity and a weak global economy.

Hapag-Lloyd's first-quarter operating loss increased to 63.2 million euros ($86.9 million) from 53.2 million euros in the same period a year ago, even though transport volumes rose 5.5 percent to 1.4 million twenty-foot-equivalent units (TEU).

Its net loss widened from 93.6 million to 119.1 million euros, which included one-off costs from the takeover of Chilean shipping Compania SudAmericana de Vapores's (CSAV) container business.

Earnings were hit by "persistently aggressive competition" and freight rates remained under pressure, the company said on Tuesday.

Chief Executive Michael Behrendt said the expansion of the G6 shipping alliance so that it would cover all east-west trades, as well as the integration of CSAV's container segment would "significantly improve" the company's ability to compete.

The G6 alliance - comprising Hapag-Lloyd, APL, Hyundai Merchant Marine, Mitsui O.S.K. Lines, Nippon Yusen Kaisha and Orient Overseas Container Line - was formed in late 2011 and began operation in March 2012 on Asia-Europe and Mediterranean trade routes.

Hapag-Lloyd also separately signed a binding deal with Chile's CSAV last month to create the world's fourth-largest container-shipping company.

First-quarter revenue fell 6 percent to 1.55 billion euros. When adjusted for exchange rate fluctuations as a result of the weaker dollar, the revenue decline was 2.3 percent.

Hapag-Lloyd did not make any specific financial forecast for 2014 but said the goal for this year continued to be improving the overall freight rate, which stood at $1,482/TEU last year.

In the first quarter, the firm said the average freight rate was $1,422/TEU, down by $124/TEU on a year ago.

Reporting by Marilyn Gerlach

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter January 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Shipping Industry Clean Up its Act

Shipping impacts the world in many positive ways by enabling trade around the world, But despite all the positive impacts, you also have negative impacts, especially environmental impacts,

Cyprus Shipping 'Navigates' the Country to Recovery

Cyprus shipping sector has evolved in the recent years as one of the leading sectors of the economy and “navigates” Cyprus to economic recovery, President of the

First Women's Expedition to the Arctic

Company "MyArctic-expeditions" organize the first women's expedition to the Arctic Ocean. The expedition will start on March 5 in the capital of the Nenets Autonomous

Finance

Cyprus Shipping 'Navigates' the Country to Recovery

Cyprus shipping sector has evolved in the recent years as one of the leading sectors of the economy and “navigates” Cyprus to economic recovery, President of the

Sardines Boost Murmansk Port Turnover

In January 2016 turnover of the Murmansk Marine Fishing Port reached 22 thousand tons of cargo, including 15 thousand tons of fish. This is higher than last year,

COSCO Plans European Transhipment Hub

China's COSCO is forging ahead with a plan to build a European transhipment hub, reports Reuters. The state owned shipping giant is expected to make an offer for

Container Ships

Nigerian Navy Foils Hijack of Maersk Ship

The Nigerian Navy has foiled an attempt by suspected pirates to hijack and abduct 25 foreign nationals aboard a container ship operated by A.P. Moeller-Maersk

Shipping Line Consolidation: What Did the Airlines Do?

The container shipping industry is faced with the challenge of ever-decreasing freight rates that can only be served viably with larger, more efficient vessels.

Sea Trade’s Problems Multiplying

For good or for bad, shipping market analysts have looked at trade growth ‘multipliers’ for many years, says Clarksons Research.   In 2015 global seaborne trade is estimated to have grown by 2.

Logistics

Cyprus Shipping 'Navigates' the Country to Recovery

Cyprus shipping sector has evolved in the recent years as one of the leading sectors of the economy and “navigates” Cyprus to economic recovery, President of the

Demolition Age Drops as the Dry Bulk Market Enters Another Challenging Year

The dry bulk market faced a lot of headwind in 2015 as dwindling demand and over-supply created very unfavourable market conditions, says BIMCO.   2016 has shown

Shipping Line Consolidation: What Did the Airlines Do?

The container shipping industry is faced with the challenge of ever-decreasing freight rates that can only be served viably with larger, more efficient vessels.

 
 
Maritime Contracts Maritime Security Naval Architecture Offshore Oil Pipelines Pod Propulsion Port Authority Ship Electronics Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1163 sec (9 req/sec)