The German container line reported a loss of EUR50.7m ($63.1m) in the third quarter of 2014, compared to a profit of EUR16.6m in the same period last year. Revenues for the quarter were almost flat at EUR1.68bn in the third quarter compared to EUR1.66bn a year earlier.
For the first nine months of 2014 Hapag-Lloyd lost EUR224m, compared to EUR56.1m in the same period in 2014.
Average freight rates for the first nine months of the year were 4.9% down on the previous year at $1,432 per teu.
The company said the usual peak period rise in freight rates did not materialise and it expects average rates to be down for the year as a whole. As result it expects to report a loss for the year as a whole and it said: “In view of the negative impact on earnings in the first nine months of 2014 resulting from sustained pressure on freight rates and in consideration of an unchanged difficult sector environment, Hapag-Lloyd expects that the negative operating result (adjusted EBIT) of the first nine months of 2014 cannot be compensated for over the remainder of 2014.” Adjusted EBIT for the first nine months was negative EUR40.6m.
Hapag-Lloyd said it expects to complete its merger with CSAV’s container business in the fourth quarter, pending regulatory approval by China.
The German line is targeting further cost savings and said: “Alongside the expected synergies of around $300m from the merger with CSAV’s container business, Hapag-Lloyd is also using a comprehensive optimisation package to face the continuing pressure of the market and the competition. At the centre of this are targeted measures to further cut costs, in addition to optimising sales.”
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