OOCL Swings to $841.6 Million Profit

OOCL Swings to $841.6 Million Profit

Orient Overseas Container Line reported a profit of $841.6 million last year, after a loss of $376.9 million in 2009 and said it expects supply and demand to be near balance this year.

The rebound in 2010 was “beyond all expectations,” Chairman C.C. Tung said. “Unusually strong demand in the first half of 2010 and positive trading conditions throughout the remainder of the year saw our lifting volumes nearing 2008 levels.”

OOCL’s Hong Kong-based parent, Orient Overseas (International) Ltd., reported profit attributable to continuing operations of $1.87 billion, including a $1 billion profit from the sale of the company’s China real estate unit. The sale left OOIL with net cash of $1.5 billion

OOCL is No. 12 on the JOC list of Top 15 Container Fleet Operators

The company’s container shipping company reported a 14.6 percent increase in liftings to 4.8 million 20-foot equivalent units, and an increase to 81 percent from 74 percent in the carrier’s vessel utilization rate. Average revenue per TEU rose 27.5 percent to $1,178.

Volume and revenue increases during the last three quarters of 2010 were boosted by comparisons with weak recession levels of 2009.

“The immediate outlook for 2011 remains positive though the level of demand growth seen in 2010 on the east-west trades is unlikely to be repeated in 2011,” Tung said. “While global economic growth in 2011 is likely to be muted, we do expect supply and demand to be in near balance. This should see a return to a normalized seasonal pattern in volumes and freight rates in 2011 compared to 2009 and 2010.”

Near the end of 2010, OOCL ordered two 8,888-TEU vessels and now has eight ships of that size due for delivery. In an interview at The Journal of Commerce’s Trans-Pacific Maritime Conference this month, Tung said OOCL expects soon to order additional ships with capacities of up to 13,000 TEUs.

-- Contact Joseph Bonney at jbonney@joc.com.