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 Reporter October 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

W&O, LESER Partner to Deliver Safety Relief Valves

W&O, a global supplier to the marine and upstream oil and gas markets for pipe, valves and fittings, valve automation and engineered solutions, has partnered with

Fednav Celebrates Anniversary Trio in Cleveland

Fednav Limited held a reception on board one of its vessels, the Federal Mayumi, at the Port of Cleveland yesterday to celebrate a trio of anniversaries: the 70th

Karl Senner Inks Distribution Deal with Electronic Power Design

Karl Senner, LLC (KS) has reached a new strategic representation agreement with Electronic Power Design (EPD). Karl Senner, LLC now represents EPD in the United States marine and offshore Markets.

Finance

New Company Takes Over OW Tanker

OW Tanker, a unit of bankrupt OW Bunker and owner of its marine fuel supply ships, has been taken over by a newly-created company, the fleet manager told Reuters on Wednesday.

WRRDA: Clearing the Channel for P3 Projects

A Creative Combination for Financing Inland Waterways Infrastructure Earlier this year, the U.S. maritime industry in general, and the inland waterways industry in particular,

Choosing the Best Financing Proposal

It isn’t always about the rate. In a robust boatbuilding market – like the one we see now – even the most successful, financially stable operators need to borrow.

Container Ships

Diana Extends Containership Time Charters

Diana Containerships Inc. announced direct continuation of time charter agreements for m/v Cap Domingo and m/v Cap Doukato   Diana Containerships Inc., a global

CMA CGM Acquires OPDR

The CMA CGM Group has acquired the German shipping company Oldenburg-Portugiesische Dampfschiffs-Rhederei GmbH & Co. KG (OPDR), CMA CGM founder, chairman and CEO Jacques R.

Matson Raises 2015 Westbound Hawaii Box Rates

Matson, Inc., a U.S. carrier in the Pacific, announced that Matson Navigation Company, Inc. (Matson) will raise its rates for the company's Hawaii service by $225

Logistics

Fednav Celebrates Anniversary Trio in Cleveland

Fednav Limited held a reception on board one of its vessels, the Federal Mayumi, at the Port of Cleveland yesterday to celebrate a trio of anniversaries: the 70th

Night Moves on America's Waterways

Overnight operations are certainly not unusual on America’s inland waterways, but that doesn’t make them any less hazardous. Onboard activities that seem so straightforward

CMA CGM Acquires OPDR

The CMA CGM Group has acquired the German shipping company Oldenburg-Portugiesische Dampfschiffs-Rhederei GmbH & Co. KG (OPDR), CMA CGM founder, chairman and CEO Jacques R.

 
 
Maritime Careers / Shipboard Positions Maritime Security Naval Architecture Navigation Offshore Oil Salvage Ship Electronics Ship Repair Ship Simulators Shipbuilding / Vessel Construction
rss | archive | history | articles | privacy | terms and conditions | 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: 0.1834 sec (5 req/sec)