AsiaContainersFinance and Insurance

Share prices of global liners leap 400% during the pandemic

Investors have piled into the red-hot container shipping market, sending share prices for top liners skywards.

Alphaliner has run the numbers for the largest, listed global carriers, revealing their share prices have leapt by an average 400% from pre-Covid-19 levels, far in excess of the gains seen across stock markets around the world over the past 16 months.

The top gainer between January 1 last year and April 30 this year was Taiwan’s Yang Ming, whose share price has leapt by 996%. Asian carriers recorded the largest gains, outpacing European rivals.

In the same period, the S&P 500 rose 29%, while the S&P Asia 50 Index, covering the Hong Kong, South Korea, Singapore, and Taiwan exchanges, rose 39%.

While there was considerable concern that liners could lose vast sums at the start of the pandemic, the reverse occurred during the course of 2020 with supply chains stretched and Western consumers spending massively online.

British shipping consultantcy Drewry is predicting container shipping will smash last year’s record profits in 2021, with 2022 also tipped to be highly profitable.

Full year 2020 figures for all liners – as tallied by Drewry – show the industry notched up a collective $26.6bn operating profit, the highest figure ever recorded by the UK analysts, with a combined operating margin of 13%.

“With higher contracts rates locked in, another highly profitable year is virtually guaranteed and Drewry thinks the industry will re-set profitability records once again in 2021, despite several OPEX headwinds in the form of higher fuel cost and charter rates,” Drewry predicted in a report issued last month.

A.P. Moller – Maersk, owners of the world’s largest containerline, today reported an all time record quarterly result, notching up an EBIT of $3.1bn on revenues of $12.4bn in the first three months of the year.

“A.P. Moller – Maersk delivered an exceptionally strong performance in Q1 2021 with record profit for the quarter… Strong demand led to bottlenecks and a lack of capacity and equipment, which drove up freight rates to record-high levels,” commented Søren Skou, CEO of A.P. Moller – Maersk.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

Comments

  1. It is not about consistent companies, but about investing cheaply and quickly, and generating short-term profits.

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