Hapag-Lloyd has seen a 6% increase in revenues during the first quarter of 2020, mainly due to an increase in transport volumes, despite the coronavirus pandemic.
Transport volumes increased by 4.3% to more than 2m teu, with an improved freight rate of US$1,094 per teu.
However transport expenses increased by almost 10%, disproportionately to revenues, particularly due to higher bunker costs.
The increase in bunker costs, up by US$98 to US$523, was a result of the transition to low-sulphur fuel oil as required by the IMO 2020 regulation.
This, along with a devaluation of bunker inventories of around US$64m due to a rapid decline in crude oil prices at the end of the first quarter, had a negative impact on earnings.
Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) decreased slightly from US$469m in 2019 to US$517m.
Free cashflow was once again positive at US$302m and, at the end of the first quarter, the liquidity remained at a good level at approximately US$1.2bn.
Rolf Habben Jansen, chief executive officer of Hapag-Lloyd AG, said: “Although we were able to pick up a bit of tailwind at the beginning of the year, we anticipate that the coronavirus pandemic will have very significant impacts in 2020, beginning in the second quarter.
“Our main focuses will continue to be the safety and well-being of our employees as well as the supply chains of our customers.”
The company has taken a wide range of measures designed to save an amount in the mid-triple-digit range to safeguard its profitability and liquidity.
Jansen added: “We adjust our service network to the lower demand and seek savings in all cost categories, from terminal, transport, equipment and network costs to overhead.”