South Korea’s Hyundai Merchant Marine (HMM) saw its net loss expand in the second quarter, mainly due to higher bunker costs and lower average freight rates.
The company ended the second quarter of 2018 with a net loss of KRW 242.7 billion, compared to a net loss of KRW 175.7 billion seen in the previous quarter.
Revenue was up by 11 percent to KRW 1.23 trillion from KRW 1.11 trillion reported a quarter earlier, attributed to HMM’s sales expansion efforts including launch of new Europe service (AEX) and deployment of its new 11,000 TEU vessel in South America Trade.
Operating loss widened to KRW 199.8 billion, compared to a loss of KRW 170.1 billion, with the company’s container business recording a loss of KRW 175.7 billion.
During the second quarter of the year, the company’s handled volume grew by 17.6 percent to 1.15 million TEU, compared to 981,199 TEU reported a quarter earlier.
The load factor reached 79.1% in the quarter, up 3.5% compared to 75.6% witnessed in the first quarter of the year.
HMM said it expects higher freight rates and load factor through the traditional peak season in the third quarter. The company plans to maximize its enterprise-wide efforts to improve its efficiency and bottom line through rationalizing service routes and pursuing economical speed to reduce bunker costs in order to overcome depressed shipping market.
“HMM will do its utmost to attain competitiveness as one of the top global carriers by improving its cost structure and reducing operating costs through fleet expansion and securing terminal assets,” the company said.