Hapag-Lloyd reports revenue boost from UASC merger

The unaudited results show volumes rose 29% to 9.8m teu, with an average freight rate of $1,051 per teu, up only marginally from $1,036 in 2016.

But transportation costs also rose during the year, up from $6.4bn in 2016 to $8bn, much of it due to the increased volumes, bunker prices rose significantly, from $226 per tonne to $318 per tonne, eating in to margins.

Earnings before interest, taxes, depreciation and amortisation climbed up to $1.2bn from $671m in 2016, and the company’s operating result before interest and taxes more than tripled from $140m in 2016 to $466m last year.

Hapag-Lloyd completed its merger with UASC in the second quarter, so the full-year figures reflect only two quarters of increased volumes attributable to UASC.

Speaking recently in Hamburg, Hapag-Lloyd chief executive Rolf Habben Jansen said that there was “light at the end of the tunnel” for container shipping now that the latest phase of consolidation was coming to an end.

“There are a few signs that the market is getting a little better,” he said. “Rates were extremely volatile in 2015-2016 but were significantly less so in 2017.”

Consolidation had also led to a fall in unit costs, which had made up for the failure of consolidation to raise rates significantly to date.

The company’s full results and annual report will be published on March 28.

Source: Lloyd’s List

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