Market headwinds have pushed German liner Hapag-Lloyd into a net loss of EUR 100.9 million (USD 115.6 million) for the first half of the year.
This is EUR 58.2 million below the 2017 half year result, which came at EUR -42.7 million.
The German shipping company attributed the poor performance to intense competition as well as higher operational costs, which were partly compensated by synergies coming from the merger with United Arab Shipping Company Ltd (UASC).
“The first half of 2018 was shaped by clearly increasing fuel costs, higher charter rates and a slower than expected recovery of freight rates. In response to that, we have implemented additional measures to recover these costs: we are critically reviewing the economic viability of our ship systems and are further optimising our terminal contracts, to gain additional relief on the cost side,” said Rolf Habben Jansen, Chief Executive Officer of Hapag-Lloyd.
The company’s earnings before interest, taxes, depreciation and amortisation (EBITDA) came at EUR 425.2 million for the six-month period, while EBIT totaled in EUR 88.7 million.
Revenues for the period climbed to EUR 5.4 billion from 4.5 billion year-on-year and the reported transport volume increased by 39 percent to 5,848 TTEU. The reported average freight rate decreased to 1,020 USD/TEU in the first half of the year, down from last year’s equivalent of 1,065 USD/TEU.
“For the remainder of the year, we see a slow but steadily improving market environment, but we recognize that there are still significant geopolitical uncertainties that could influence the market. This only reinforces the necessity to be able to react quickly when needed – and we therefore will accelerate some of our digitalisation initiatives and finalize our new strategy until the end of this year,” Jensen added.