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

People & Company News

Senate Confirms Three to Serve on Federal Maritime Commission

The U.S. Senate has confirmed the nominations of three individuals to serve as Federal Maritime Commissioners: Rebecca F. Dye, Michael A. Khouri and Daniel B. Maffei.

Xeneta: No Silver Lining for Container Shipping in Brexit Storm

Xeneta, a  global benchmarking and market intelligence platform for containerized ocean freight, believes that the UK’s decision to leave the European Union will

PALFINGER Finalizes Harding Acquisition

The PALFINGER Group closed the acquisition of 100 percent of the shares in Herkules Harding Holding AS, i.e. the globally operating Harding Group, supplier of lifesaving

Finance

Baltic Index Rises on Increased Demand Across Segments

The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry bulk commodities, rose on Thursday on higher demand across all vessel segments.

PALFINGER Finalizes Harding Acquisition

The PALFINGER Group closed the acquisition of 100 percent of the shares in Herkules Harding Holding AS, i.e. the globally operating Harding Group, supplier of lifesaving

Beijing Slams South China Sea Court Proceedings

Permanent Court of Arbitration ruling set for July 12. An international court said it would deliver a hotly anticipated ruling in the Philippines' case against

Container Ships

Xeneta: No Silver Lining for Container Shipping in Brexit Storm

Xeneta, a  global benchmarking and market intelligence platform for containerized ocean freight, believes that the UK’s decision to leave the European Union will

SOLAS Container Mass Verification Rule Enter into force

A new regulation requiring the gross mass of a container to be verified before it is loaded onto a ship enters into force today (1 July 2016). It will assist in

UASC Shareholding States Vote to Back Hapag-Lloyd Merger

United Arab Shipping Company (UASC) said its six shareholding states backed a merger deal with German container shipping line Hapag-Lloyd AG at a meeting on Wednesday.

Logistics

Netherlands Opts for ‘Flexible’ Container Weighing

As of July 1, shippers and freight forwarders are required to verify the weight of a container before the container is loaded onto a ship.   The Netherlands’

Xeneta: No Silver Lining for Container Shipping in Brexit Storm

Xeneta, a  global benchmarking and market intelligence platform for containerized ocean freight, believes that the UK’s decision to leave the European Union will

Baltic Index Rises on Increased Demand Across Segments

The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry bulk commodities, rose on Thursday on higher demand across all vessel segments.

 
 
Maritime Careers / Shipboard Positions Maritime Security Maritime Standards Naval Architecture Offshore Oil Pod Propulsion Port Authority Salvage Ship Simulators Winch
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: 0.1231 sec (8 req/sec)