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SM Line, South Korea’s only ocean-going container carrier, incurred a net loss for the first time since its start-up phase in 2019, as all 13 non-listed South Korean container lines reported significantly reduced earnings in 2023 (these companies report their previous year’s accounts in the middle of the following year).

Established by the Samra Midas group to take over the business of Hanjin Shipping, which went bankrupt in 2017, SM Line’s revenue fell 66% year-on-year to $564.3m, and the company suffered an $88.26m net loss, reversing the net profit of $836.58m in 2022.

SM Line is active in the intra-Asia and Transpacific lanes, operating 15 ships of 68,504 teu.  The company is hopeful that with freight rates surging amid the Red Sea crisis and a recovery of US consumer demand, it can restore profitability this year.

Next month, SM Line will start a slot exchange with its larger compatriot peer, HMM, with both companies taking 300 teu on each other’s Asia-US West Coast services.

The only other loss-making South Korean operator was Namsung Shipping, which lost $22.86m, compared with a net profit of $152m in 2022.

Besides the post-Covid normalisation of freight rates, increased competition in the intra-Asia segment, particularly from mainline operators, also eroded their margins.

In terms of pure operators, Korea Marine Transport Company (KMTC Line) maintained a 39th straight profitable year, going back to its incorporation in 1985. However, its revenue fell 49% from 2022, to $1.93bn, and net profit plunged 95% to $79.07m.

KMTC also ceded its crown as the top-earning South Korean feeder operator to Sinokor Merchant Marine subsidiary Heung-A Line, whose net profit was down 80%, to $103.63m. Sinokor, which is also a tonnage provider of larger container ships as well as vessels in other segments, saw net profit fall 80% to $299.6m.

As the market corrected, the number of South Korean operators whose operating profit passed the KRW100bn ($77.22m) mark also decreased from eight in 2022 to three in 2023: HMM, Sinokor, and Heung-A Line.

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