Evergreen Marine Corp (長榮海運), the largest container cargo shipping company in Taiwan, reported better-than-expected earnings for the first quarter amid an increase in freight rates due to substantial demand and a supply shortage.
Evergreen in a statement on Friday reported NT$36.08 billion (US$1.29 billion) in net profit for the January-to-March period, or earnings per share (EPS) of NT$7.04, beating a market estimate of about NT$5.
Its first-quarter EPS were a significant improvement from its losses per share of NT$0.09 over the same period last year, data compiled by the Taiwan Stock Exchange showed.
Photo courtesy of Evergreen Marine Corp
Evergreen’s first-quarter EPS also topped the NT$5.06 in EPS that the company raked in during the entire year last year, the data showed.
FREIGHT RATES
As of Friday, due to a lack of containers and shipping services worldwide, the freight rate on the route from the Far East to Europe hit a new high of US$4,678 per 20-foot equivalent unit.
In addition, the freight rate on the route from the Far East to the US east coast rose NT$617, or 9 percent, to US$7,036 per 40-foot equivalent unit (FEU), while the freight rate on the route from the Far East to the US west coast fell US$415 to US$4,608 per FEU.
ANALYSTS’ FORECASTS
Evergreen’s local rival Yang Ming Marine Transport Corp (陽明海運) has not yet released its first-quarter results, but analysts said that its EPS could challenge NT$7.
Evergreen and Yang Ming could report EPS of NT$27.39 and NT$24.33 respectively for this year, and their share prices might challenge NT$137 and NT$144, analysts said.
On Friday, Evergreen shares rose 4.81 percent on the main board to close at NT$85, while Yang Ming shares gained 8.45 percent to end at NT$91.5, pushing up the shipping sector by 3.39 percent.
Due to growing freight rates, the shipping sector has driven gains on the broader market in the past few sessions. Since the beginning of March, Evergreen shares have jumped about 124 percent and Yang Ming shares have soared by about 216 percent.
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