The nation’s three major container shipping companies reported rising revenue and profit in the first half of this year on the back of higher freight rates amid ongoing disruptions in the Red Sea, and a better-than-expected rebound in cargo volumes from Asia to the US and Europe, the companies’ regulatory filings released this week showed.
The strong inventory restocking combined with capacity tightness has led to significant increases in freight rates throughout the first half of the year, with analysts expecting this momentum to continue this quarter due to factors such as seasonal cargo demand, port congestions and equipment shortages.
However, rising capacity boosts to the US West Coast, North Europe, Latin America and India in the coming month due to the introduction of more new vessels might limit freight rate growth in the fourth quarter, especially as the off-season approaches, analysts said.
Photo: AFP
Evergreen Marine Corp (長榮海運), the nation’s largest container shipping company in terms of fleet size, posted earnings per share of NT$21.86 in the first six months, far better than Yang Ming Marine Transport Corp’s (陽明海運) NT$6.66 and Wan Hai Lines Ltd’s (萬海航運) NT$5.77.
That came as Evergreen’s net profit increased 362.17 percent year-on-year to NT$46.84 billion (US$1.45 billion) during the January-to-June period, on revenue of NT$194.97 billion, which rose 45.27 percent from the same period a year earlier, the company reported on Tuesday, it said.
Gross margin increased to 28.12 percent, from 21.31 percent a year earlier, it added.
To meet rising operational needs, the company on Tuesday said its wholly-owned subsidiary, Evergreen Marine (Asia) Pte Ltd (長榮亞洲), would lease 223,301 units of containers from Gaining Enterprise SA for up to nine years at a total cost of US$369.62 million.
Yang Ming, the nation’s second-largest container shipper, on Monday reported that its net profit surged 611.28 percent year-on-year to NT$23.27 billion in the first half of the year as revenue jumped 33.87 percent to NT$96.39 billion from a year earlier, while gross margin increased to 27.72 percent from 9.68 percent last year over the same period.
Despite its impressive performance compared with the same period last year, Yang Ming warned that the global economic situation remains precarious amid persistent service inflation, trade tensions and geopolitical conflicts.
In addition, the slowing US economy and the upcoming US presidential election could add further uncertainties on the macroeconomic front, the company said.
Meanwhile, Wan Hai on Monday reported a profit of NT$11.57 billion last quarter, its highest in seven quarters, bringing its net profit in the first half to NT$16.19 billion. It posted net losses of NT$4.46 billion in the same period a year earlier.
First-half revenue grew 31.49 percent to NT$65.78 billion, while gross margin increased to 24.05 percent from minus-4.76 percent a year earlier, the company said.
While the third quarter is the peak season for back-to-school and pre-holiday stocking in Europe and the US, Wan Hai said the market is still full of challenges such as geopolitical tensions, supply chain disruptions and tariff barriers, warranting effective route management and cost control, it added.
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