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Hapag-Lloyd loses $653m in year it merges with CSAV

Hapag-Lloyd loses $653m in year it merges with CSAV
Hapag Lloyd lost EUR604m ($653m) in 2014 as it became the world's fourth-largest container line.

Integration costs for the merger with Compañía Sud Americana de Vapores (CSAV) totalled EUR107.3m for the year, in which Hapag-Lloyd also had impairments totalling EUR127.4m related to the sale of older vessels.

Revenues of EUR6.8bn were up EUR241m compared to 2013, as container volumes rose 7.5% to 5.9m teu. The company's average freight per teu was down over 3% from $1,482 in 2013 to $1,434 in 2014.

Despite the year's loss, Hapag-Lloyd believes its EUR900m liquidity reserves and EUR4bn equity places it well amongst its competitors in terms of financial position.

The company has identified savings of $300m per year in synergies through its merger with the Chliean box line , savings it hopes to start seeing in 2015 and have fully in place by 2017.

"Hapag-Lloyd has not just become the fourth-largest liner shipping company in the world," commented chairman of the Executive Board Rolf Habben Jansen, "but it has also become one of the market leaders in the attractive North–South trades – in addition to our already strong position in the North Atlantic. Size – and the associated economies of scale – is an unavoidable prerequisite for long-term commercial success and further growth in our industry.

Hapag-Lloyd's fleet grew by 40 vessels in 2014 to 191 ships, with a total capacity of 1m teu.