DE4CC0DE-5FC3-4494-BCBF-4D50B00366B5
Supply Chain

Hapag-Lloyd Posts 83% Lower Net Profit In 2023

By Reuters
Share this article
Hapag-Lloyd Posts 83% Lower Net Profit In 2023

German container shipper Hapag-Lloyd has posted a net profit of €3.0 billion for 2023, down 83% from a year earlier, and cut its dividend by 85% in what it called a challenging market environment.

"We achieved the third-best Group profit in the history of our company - even if it is significantly lower than it was in the exceptionally strong year 2022 due to the normalisation of global supply chains," said chief executive Rolf Habben Jansen.

"We ... expect to see an overall decrease in earnings in 2024," he added, citing the crisis in the Red Sea, where commercial shippers have been skipping the Suez Canal after Yemen-based Houthi militants began attacking ships.

Soaring Prices

Hapag-Lloyd, the world's fifth-biggest container liner, had benefited from soaring prices in 2022 as global trade faced hiccups during its recovery from the coronavirus crisis, but a return to more secure logistics has cut freights sharply.

The dividend proposal will be €9.25 per share, down from €63 previously.

ADVERTISEMENT

The company forecast 2024 earnings before interest, taxation, depreciation and amortisation (EBITDA) in a range of €1.0 billion to €3.0 billion, compared with €4.4 billion achieved in 2023, when it was down by 76.8%.

Earnings before interest and taxes (EBIT) this year will likely be between minus €1.0 billion to €1.0 billion, it said.

This will follow a €2.5 billion EBIT in 2023, already only a fraction of 2022's €17.5 billion.

Freight Uncertainty

The forecast remains subject to considerable uncertainty given the volatile development of freight rates and geopolitical challenges, the company said.

ADVERTISEMENT

Transport volume rose 0.5% to 11.9 million twenty-foot equivalent unit (TEU) containers, but freight rates fell 48% to $1,500 per TEU, contributing to a near halving of revenue to €17.9 billion.

Bigger competitor Maersk last month said industry overcapacity would hit profit this year more than it previously expected.

Get the week's top grocery retail news

The most important stories from European grocery retail direct to your inbox every Thursday

Processing your request...

Thanks! please check your email to confirm your subscription.

By signing up you are agreeing to our terms & conditions and privacy policy. You can unsubscribe at any time.