Hanjin Shipping said it had a loss of 34.7 billion South Korea won (KRW), or $31.5 million, in the first quarter of 2013, compared to a loss of 338.4 billion KRW in the same 2012 billion.
Sales amounted to 2.5 trillion KRW ($2.3 billion) in the first quarter of 2013, 10.2 percent more than sales in the same 2012 period. The operating loss was 59.9 billion KRW in the first quarter, smaller than the operating loss of 217.3 billion KRW in the same 2012 period.
Hanjin said container volume in the first quarter was 1,109,285 TEUs, an increase of 9.3 percent over the same 2012 period. Container sales accounted for the bulk of the company’s revenue: 2.06 trillion won for the quarter, up 14.1 percent year-on-year.
The bulk division’s revenues fell by 11.1 percent to 337.4 billion KRW in comparison to 2012 first quarter due to decreased freight rates.
“In spite of transport volume growths of 16.3 percent, 15.0 percent and 7.4 percent in Asia-North America, Asia-Europe and Intra-Asia trades respectively, the container business unit reported an operating loss of 70.6 billion KRW mainly due to unsatisfactory rate increase.” the company said. Still, that container operating loss was far less than the 243.4 billion KRW recorded in the first quarter of 2012.
“The container sector’s supply continues to increase with the delivery of mega vessels, but carriers' various efforts such as service rationalization, slow-steaming, early return of chartered-in vessels and scrapping of old vessels, etc., are continuously implemented,” Hanjin said. “Hence, the imbalance between supply and demand will gradually be eased, and the profitability is expected to improve through additional rate increase with the coming of peak-season as well as stabilization of oil prices.
“As for the bulk sector, the global bulk market outlook is still weak due to continuous pressure from vessel supply growth and delayed recovery of the Chinese economy; however consistent demand for transporting South America’s crops and rising demand for coal to power the approaching summer’s electricity, etc. are expected to have positive effects on the market,” the company added.
Hanjin predicted "even though some difficulties are inevitable due to supply growth, numbers in the second quarter will improve through continued rate restoration efforts and active cost reduction, etc." - Chris Dupin