Hapag-Lloyd reached high profit in Q3 – with much more to come
Hapag-Lloyd has posted a huge net profit of $3.4bn for the third quarter, and a cumulative nine-month result of $6.7bn that compares with just $605m earned in the first three quarters of 2020.
Putting the fifth-largest ocean carrier’s earnings into context, that nine-month profit exceeds its return from the whole of the past five years.
And CEO Rolf Habben Jansen said today the carrier’s result for Q4 would be equally strong, and that he saw “no dramatic change” for the first quarter of 2022.
He believes the carrier does not expect to see any return to normalization in liner trades before the end of H1 next year
Notwithstanding the recent dive in spot rates from Asia, Mr Habben Jansen said he expected the “triple-digit” percentage increases the line had negotiated so far with its contracted customers to positively impact results from Q1 22 onwards, insulating the carrier from any slump in short-term rates.
He said some Asia-Europe contracts were still being agreed with shippers and there were “significantly more ‘early bird’ contracts” being agreed on the transpacific, well ahead of the normal early spring negotiating season.
Revenue in Q3 soared 110% above the same period of last year, to $7.4bn, on virtually static liftings of 2,976,000 teu, resulting in a doubling of its average rate, to $2,234 per teu.
Hapag-Lloyd’s average rate for the period compares favourably with Maersk’s reported $1,780 per teu, and is on a par with THE Alliance partners ONE and HMM’s declared average rates for the quarter of $2,375 and $2,330, respectively.
The average rates include all trades, including backhaul legs, and are therefore significantly lower than the market rates on the Asia to US and Europe headhaul trades.
Interestingly, Hapag-Lloyd saw a substantial 40% volume contraction in its intra-Asia tradelane during the quarter, to just 130,000 teu, as it prioritised other more lucrative routes.
In the third quarter, Hapag-Lloyd completed the takeover of African trade specialist NileDutch, as well as agreeing a 30% investment in the JadeWeserPort, Wilhelmshaven. It has also paid down the majority of its $6bn debt this year and said it expected to have a leverage “close to zero” by the end of December