Hapag posts $38 million net loss, but operating profit hits US$133 million

2012 03 23

HAMBURG's Hapag-Lloyd, the world's No 4 container carrier, has posted a net loss of US$38.3 million in 2011, despite an operating profit of $133.3 million, after reporting a $565 million net profit in 2010.

"In comparison with the competition, this was an excellent result for Hapag-Lloyd in a challenging year," said CEO Michael Behrendt, referring to the overall losses suffered by rival carriers.

"Not only were we the only large liner shipping company to achieve a positive operating result in all four quarters of 2011, but we were also the only market participant to close the second half of the year with a group profit after interest and taxes," he said.

The world's fourth largest carrier previously reported revenues slipped to $8 billion from $8.2 billion in 2010 largely because of exchange rate fluctuations.

Throughput grew 5.1 per cent to 5.2 million TEU while rates fell 2.4 per cent to $1,532 per TEU. A 34 per cent surge in the average bunker price to $655 per ton "severely depressed" profits, said the statement from the carrier. The additional cost of around $600 million could not be passed on to customers "as some market players resorted to aggressive pricing in 2011 to gain market share".

But Mr Behrendt said the market appears to have accepted recent rate increases that came into force in March and will again go into effect in April when higher rates are imposed.

"These increases are unavoidable in order to get back to adequate and sustainable rates again, especially as the bunker price has gone up even further," he said.

Source Shipping Gazette - Daily Shipping News

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