Orient Overseas (International) Limited (OOIL), the Hong Kong-listed parent of containerline OOCL, reported today its worst full year results since 2009, but remained committed to seeing the downturn out despite frenzied rumours earlier this year linking the line to a buy-out.
OOIL registered a net loss of $219.2m in what veteran chairman CC Tung described as “some of the most difficult markets in our industry’s history”.
“A combination of steady but low growth in most regions and an overhang of excess supply built up in recent years led to extremely challenging conditions in many trade lanes for most of 2016,” Tung noted in OOIL’s annual report.
“As fuel prices rose in the second half of the year, industry performance was badly affected by freight rates that frequently sank below the levels seen in 2009,” added Tung.
At the start of next month OOCL will join Cosco, CMA CGM and Evergreen in a new container grouping called the Ocean Alliance, something Tung said was key to seeing through the tricky trading conditions for the liner sector.
“In these turbulent times, with industry consolidation occurring at a pace that few, if any, had expected, OOCL continues to build its future on the twin pillars of alliance membership and the efficient operation of the most appropriate vessels for each trade lane,” Tung said.
OOIL’s share price spiked in January this year following reports of a possible takeover by either Cosco or CMA CGM, something the Hong Kong-listed company strenuously denied.