Hapag-Lloyd nearly halved its operating loss in the seasonally weak first quarter as the German ocean carrier posted modest gains in freight rates and cargo volumes and paid less to fuel its ships.
The adjusted loss before interest and tax narrowed to €53.2 million ($68.6 million) from €99.5 million ($ 128.4 million) a year earlier on revenue up 3.1 percent at €1.65 billion ($2.1 billion).
There was a net loss of €93.6 million ($120.7 million) against €132.4 million ($170.8 million) in the same period in 2012.
“Liner shipping started 2013 on a higher level than in 2012,” said Michael Behrendt, chairman of the executive board of Hapag-Lloyd. “However, the competition remains extremely challenging.”
Hapag-Lloyd said it is “striving” for an operating profit for the full year despite ongoing uncertainties in the global economy.
The world’s fifth-largest carrier transported 1.33 million 20-foot-equivalent units in the quarter, compared with 1.32 million TEUs in the first quarter of 2012.
The average freight rate climbed 4.2 percent to $1,546/TEU from $1,484/TEU, with all trades, except the Atlantic, posting gains.
Rates have come under “tangible” pressure since April, especially on the key East-West routes, and competition is getting tougher on Latin American trades, Behrendt said.
“It is absolutely essential that rates soon return to a sensible, profitable level. This is absolutely essential and in the interests of everyone who relies on a functioning, reliable maritime shipping industry — from shipping lines to shippers,” he said.
Carriers make most of their money in the third quarter peak season when transport volume rises as goods are shipped from Asia to Europe and North America in the run-up to Christmas. “We cannot afford a repeat of last year’s non-existent peak season, “Behrendt said.
Hapag-Lloyd this week announced a $1,000/TEU rate hike for westbound shipments from the Far East to north European and Mediterranean ports from July 1, and a $500 peak-season surcharge from August 1 through September 30.