South Korea’s HMM has posted a much lower profit for the first quarter after container ship earnings fell from record levels.
Net profit came in at KRW 285bn ($213m), down from KRW 3.1 trillion in the same period of 2022.
Revenue decreased 58% to KRW 2.1 trillion, from KRW 4.9 trillion a year ago, while operating profit plunged 90% to KRW 307bn.
“The easing of global supply chain pressures has affected revenue and profits and has led to the normalisation of the container shipping market,” the company said.
The Shanghai Containerized Freight Index averaged 969 points in the first quarter, significantly down from 4,851 points a year earlier.
HMM also has VLCCs, product tankers and bulkers.
“Despite lower freight rates, container and bulk businesses realised profits, mainly driven by service realignment and reduced operating costs,” the shipowner said.
High inflation pressure due to the rising cost of energy and raw materials has remained, it said, which has caused higher interest rates and decreased demand.
No confidence
“This downward trend in the global economy is expected to continue, with no encouraging sign of restoring consumer confidence in the near term,” HMM said.
It pledged to focus on a wide range of cost-cutting measures and enhancing operational efficiency to make its business competitive amid market volatility and widespread uncertainties.
There will also be a “comprehensive approach” to accelerate its environmental, social and governance-orientated management by reinforcing its competence with constant investment and the latest IT infrastructure.
