High Shipping Costs Are Here to Stay, Says Bloomberg
By Henry Ren (Bloomberg) Stubbornly high shipping expenses for businesses are getting sealed into contracts for the next 12 months, forcing companies to pass the extra costs on to consumers....
FRANKFURT, Nov 11 (Reuters) – Newly-listed German container shipping group Hapag Lloyd said on Wednesday it broke even in the third quarter as it benefited from a merger with Chile’s CSAV and additional cost cuts.
Hapag-Lloyd, which reaped $300 million from an initial public offering (IPO) earlier this month, posted a quarterly net profit of 3.2 million euros, compared to a loss of 50.7 million in the year-earlier period.
Shares were indicated to start trading flat.
The market environment remains “very challenging”, Chief Executive Rolf Habben Jansen said in a statement.
Hapag-Lloyd had postponed its IPO, trimmed the number of shares on offer, lowered the price range and then priced at the bottom of the revised range after a profit warning from peer Maersk weighed on investor demand.
On average, freight rates were down to $1,189 per standard container (TEU) in the third quarter, compared to $1,448 in the year-earlier period, as global trade slowed.
But Hapag-Lloyd benefited from lower oil prices and saw transport costs per container decrease by $240 to $1,111 in the first nine months. It did not provide a quarterly figure.
Third-quarter revenues increased to 2.1 billion from 1.7 billion euros, while earnings before interest, taxes, depreciation, and amortisation rose to 197 million from 111 million euro. (Reporting by Arno Schuetze; Editing by Maria Sheahan)
(c) Copyright Thomson Reuters 2015.
Join the 67,778 members that receive our newsletter.
Have a news tip? Let us know.