Hapag-Lloyd doubles operating result in first nine months

HAPAG-Lloyd has reported a significantly improved operating result on the back of increased volumes and slightly higher freight rates in the first nine months of the year.
Revenues were up €1bn ($1.1bn) to €9.5bn, but costs also rose by 3.5% due to higher bunker costs. Earnings before interest and tax more than doubled to €643m. Ebitda of €699m was flattered by a €341m impact from the adoption of IFRS 16 reporting rules.
Volumes for the nine-month period were up just 1.2% on last year, and were lower in the third quarter than in the corresponding period last year. Average freight rates were up 4.2%, or $43 per teu, across the nine-months to the end of September, but fuel costs rose 10.6%.
Total transport expenses were up 3.5% compared with the previous year, due to higher bunker prices, a stronger US dollar compared to the euro and an increase in charter costs. But this was modified by the first-time application of IFRS 16, which lead to a reduction in transport expenses

 “We have achieved a very respectable result after nine months,” said Hapag-Lloyd chief executive Rolf Habben Jansen. “Despite geopolitical tensions and trade restrictions, we benefitted from higher transport volumes and better freight rates and also kept a close eye on our costs.”

The Hamburg-based carrier expects full-year ebitda to be at the upper end of its earlier guidance of €1.6bn-€2bn.
 “The development of earnings in the first nine months of the 2019 financial year was in the upper range of the Executive Board’s expectations at the start of the year,” Hapag-Lloyd said. 
 “By contrast, the increase in transport volume was slightly lower than had been expected at the start of the year. The main reason for this development is the general deterioration of the global economic climate, in particular due to geopolitical uncertainties. The development of earnings in the 2019 financial year will continue to depend largely on the growth in transport volume, as well as the development of freight rates and the price of bunker.”