Ongoing bunker price rises contributed to a tough first quarter of 2017 for Hapag-Lloyd with a loss of €62.1m (US$67.9m) despite an increase in transported volumes.
Average bunker prices were the highest level seen since June 2015 at US$313 per tonne, up from last year’s figure of US$197 per tonne.
During the quarter, the average freight rate was US$20 lower than in the equivalent period last year.
In similar fashion to Maersk Line, a statement from the carrier said that freight rates are on the up although there will be a time-lag before these impact financial results.
“Rate increases were successfully introduced in a number of trades even though the industry environment remains challenging, but these rate increases are only going to have an impact on the company’s result later in the year,” noted the Hapag-Lloyd statement.
Nevertheless, the shipping line managed a positive operating result of €3.5m (US$3.8m), bolstered by a 6.8% rise in transported container volumes to 1.9m teu.
Exchange rate effects also helped to push revenue up by 10.4% to €2.13bn (US$2.33bn).
Rolf Habben Jansen, CEO of Hapag-Lloyd, said: “Our activities in the first quarter focused on preparations for the merger with UASC and on the launch of our new alliance. The launch of the THE Alliance went well, and the merger with UASC will be closed shortly.
“After the closing our priority will be to integrate UASC into Hapag-Lloyd quickly and to realise initial synergies from the merger.”
The merger with the Arabian liner shipping company is expected to generate annual savings of US$435m from 2019 onwards, with a large proportion of this expected to be achieved in 2018.