Hanjin Swings to Profit in Third Quarter

Hanjin Shipping said it swung to a profit of $196 million in the third quarter ended Sept. 30, compared to a loss of $338 million in the same quarter of last year.

On a sequential quarter-to-quarter basis, the South Korean shipping line’s third-quarter profit was 34.2 percent higher than the $146 million it earned in the second quarter of this year, which Hanjin attributed to inventory restocking in the U.S. and Europe, increased volumes during the peak season and various cost-cutting measures.

Total revenue for the quarter reached $2.3 billion, up 30.7 percent from $1.4 billion a year earlier.

The carrier’s operating profit was $314 million, compared to the loss of $200 million a year ago.

Container volumes increased 6.9 percent to 977,386 20-foot equivalent container units in the quarter from a year earlier as container shipping revenue rose 73.6 percent to $1.1 billion and operating profit rose 156.3 percent to $323 million.

Hanjin said higher container revenue was driven by rate increases on the Asia-Europe and trans-Pacific trade and peak season surcharges.

Revenue from bulk cargo increased 16.9 percent year over year to $346 million as tonnage increased 40.1 percent. The bulk division’s loss shrank to $9 million in the quarter from $23 million in the same quarter last year. Hanjin said the loss “was mainly caused by China’s reduced import of raw materials and some seasonal effects.”

Hanjin already announced plans on Nov. 1 to reduce the capacity of its container fleet during the fourth quarter and is considering further cuts for the slack winter season. But the company said it expects the seasonal demand for mega-sized bulk vessels is likely to grow in the fourth quarter “as the transport of raw materials from major import countries is expected to increase.” It also expects demand for small and medium-sized bulk vessels to grow.
(Source:www.joc.com)