Germany’s top boxline Hapag-Lloyd is awash in red ink and is conducting a massive fleet-wide review of its operations to slash costs amid tricky conditions for liners worldwide.
Announcing the company’s interim results today, Rolf Habben Jansen, CEO of the Hamburg-based line, revealed a net loss of EUR100.9m, more than twice as bad as its EUR42.7m loss for the same period in 2017.
“These developments are mainly driven by the ongoing intense competition as well as higher operational costs, partly compensated by synergies coming from the business combination with United Arab Shipping Company Ltd (UASC),” the company said in a release.
Habben Jansen said he was taking severe action to stem the losses.
“The first half of 2018 was shaped by clearly increasing fuel costs, higher charter rates and a slower than expected recovery of freight rates,” he said, adding: “In response to that, we have implemented additional measures to recover these costs: we are critically reviewing the economic viability of our ship systems and are further optimising our terminal contracts, to gain additional relief on the cost side.”
Nevertheless, just like his counterpart at Maersk, Soren Skou, had intimated earlier this week, Habben Jansen felt the worst was over for container shipping this year.
“For the remainder of the year, we see a slow but steadily improving market environment, but we recognise that there are still significant geopolitical uncertainties that could influence the market. This only reinforces the necessity to be able to react quickly when needed – and we therefore will accelerate some of our digitalisation initiatives and finalise our new strategy until the end of this year,” Habben Jansen concluded.