Norway’s Hoegh Autoliners continues to make money, even as the Red Sea turmoil drags on volumes.
The Oslo-listed car carrier owner said net earnings were $115m to 31 March, against $117m for the same period last year. The 2023 figure was a record for a first quarter.
The company brought in $328m of revenue, down from $354m year over year.
The car carrier market had already been running hot for most of 2023 as Chinese electric car exports skyrocketed, pushing up rates as the market was left undersupplied with tonnage.
Rates climbed further when owners rerouted ships away from the Red Sea in mid-December after the Yemen-based Houthis began launching attacks on commercial ships.
This pushed rates up but held volumes down, as diverting around the Cape of Good Hope can add roughly 14 additional days.
The gross freight rate increased by 3% compared with the fourth quarter, at $98.30 per cbm.
A dividend of $109m will be paid in May.
Chief executive Andreas Enger called the result “solid”.
“While the market remained tight and rates stayed at record level, the rerouting of vessels following the tension in Red Sea adversely impacted capacity and volumes transported, resulting in lower operating income for the quarter,” he said.
Higher volumes now expected
Rescheduling of vessels has now stabilised and Hoegh Autoliners expects higher volumes.
“The estimated annual loss of volume if the situation persists is around 800,000 to 900,000 cbm due to longer voyages leading to reduced capacity,” it said.
“The combination of a higher share of cargo transported under repriced contracts and a healthy spot market is expected to continue through Q2.”
The company said it will continue to monitor the Middle East situation closely.
