Peter T. Leach, Senior Editor | Nov 04, 2011 11:41AM EDT
Hanjin Shipping reported a third-quarter operating loss of $1.5 million on its container operations as sliding freight rates and higher fuel costs offset a 12.3 percent increase in container volume year-over-year.
The South Korean carrier’s loss mirrored the losses being reported by other major carriers, including NOL, OOCL and NYK Lines, “K” Line and MOL. Hanjin’s loss on its container operations reversed the profit in the same quarter a year ago, when it earned $323 million.
Container revenue of $17.8 billion fell by 15.7 percent year-over-year “due to insufficient freight recovery of the trans-Pacific and Asia-Europe trades,” the company said.
Hanjin reported a group-wide loss of $773 million, compared to a profit of $196 million in the year-earlier quarter. Group revenue fell by 12.6 percent to $22.2 million.
Hanjin said the third-quarter loss was smaller than its second-quarter loss due to a currency conversion gain from the lower value of the Korean won “caused by economic instability in the U.S. and the euro zone.”
The carrier earned a small operating profit of $288,067 on its bulk operations compared to a loss in the second quarter, but more than three times as large as its year-earlier profit of $90,941.
Hanjin said that in the fourth quarter, “the container division will focus on recovering freight rates by service rationalization as a preparation for the expected imbalance between demand and supply especially during the traditional slack season.”
-- Contact Peter T. Leach at pleach@joc.com. Follow him on Twitter @petertleach.