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Hubline to exit container shipping

Hubline to exit container shipping
Malaysia’s Hubline is to exit container shipping and focus on break bulk.

The Bursa Malaysia listed-shipowner said that it plans to exit its loss making container shipping business by the end of its current financial year on 30 September 2015.

“Due to the losses incurred by the container shipping division over the last few years, the board has been forced to reassess the group’s financial and operational strategies It has determined that continued participation in the container shipping market without immediate turnaround in the industry landscape, will eventually ‘harm’ our profitable operations of the break bulk division,” the company said in a statement to the stock exchange.

Hubline said its break bulk division has the potential to grow without the challenge of subsidizing its container shipping business. Hubline’s container shipping business largely serves intra-Asian trades to and from Malaysia.

Over the last four years container shipping has contributed 79% of the company’s revenues but made a -134% contribution to profit before tax.

“The exit will have a material effect on the financial results of the group for the financial year ending 30 September 2015, as impairments and losses will be crystallized to terminate the drain to the group’s resources,” the company said.