News / Solid half-year result, 'but don't let's get carried away', says Hapag-Lloyd chief

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Despite the pandemic, Hapag-Lloyd recorded a net profit of $287m in the second quarter of the year. This compares with a $56m profit for the same period of 2019.

And for the half-year, the carrier reported a net profit of $314m, versus $165m last year, a 90% jump in profitability.

At ebit level for the first half, there was an improvement of 28%, to $563m.

Chief executive Rolf Habben Jansen said the group had produced “a very solid half-year result, despite the coronavirus crisis”.

While transport volume fell year-on-year by 3.5% in H1 to 5.76m teu and by 11% in Q2, revenue slipped just 0.6% for the six-month period to $7bn, as the average freight rate across its tradelanes was up 3.1%, to $1,104 per teu.

But Mr Habben Jansen added: “We are still very cautious. It’s very easy to get carried away by a couple of weeks of good bookings, and we would be very naïve to assume that we are through the pandemic.”

He said markets were still “very unstable”, and that the carrier was seeing huge booking volatility from week to week.

“We will keep a close eye on the Covid-19 pandemic and flexibly react to market changes. On the whole, the pandemic is and will remain a major source of uncertainty for the entire logistics industry,” he added.

Surprisingly, Hapag-Lloyd’s biggest tradelane, Latin America, recorded a 1.6% year-on-year increase in volumes for the half-year, to 1.41m teu, however liftings slumped by 6.4% in Q2 as the pandemic raged through Latin America.

On the transpacific, liftings were down 5.7% to 890,000 teu, but revenue decreased by a modest 3% reflecting higher freight rates.

From Asia to Europe, Hapag-Lloyd carried 9.8% less volume than in the previous H1 period, at 1.1m teu, including a 15.3% downturn in Q2. Again the carrier’s revenue on the route held up well, dipping only 5% on the previous year.

Mr Habben Jansen said demand was “stronger than we thought” for Q3 and expected capacity reductions to be in the “middle single-digit” range.

He did, however, identify the transatlantic tradelane as suffering a “significant impact on volumes” due to Covid-19, and said he expected current capacity adjustments measures would be continued through the quarter.

Although Hapag-Lloyd expects global container volumes will contract by some 7% this year, Mr Habben Jansen pledged that the carrier would not look to grow its market share in the downturn, maintaining the group ethos of “profitability over market share”.

Hapag-Lloyd said it was adopting a cautious approach to its full-year earnings guidance, maintaining its forecast of an ebit level of between €500m and €1bn.