‘Considerable uncertainties’ cloud forecasts for HMM, Yang Ming

Despite hefty gains in the first three quarters of 2022, Asian ocean carriers HMM and Yang Ming are cautious about what the future holds.

HMM, which reports in Korean won, said its third-quarter revenue rose 27.1% year over year to 5.1 trillion won ($3.76 billion) from 4 trillion won ($2.7 billion). Operating profit in Q3 was 2.6 trillion won ($1.9 billion), up 14.5% from 2.27 trillion won ($1.68 billion) in the third quarter of 2021, and net profit was 2.61 trillion won ($1.91 billion), up 13.3% from 2.3 trillion won ($1.7 billion) last year. 

For the first nine months of 2022, revenue totaled 15 trillion won ($11.13 billion), up 61% from 9.3 trillion won ($6.91 billion) in the same period last year, and operating profit was 8.6 trillion won ($6.42 billion), up 85.7% from 4.6 trillion won ($3.46 billion) in 2021. Net profit shot up by 225% from 2.6 trillion won ($1.97 billion) in 2021 to 8.6 trillion won ($6.41 billion) in the first nine months of 2022, HMM said Wednesday. 

“HMM has maintained a robust operating margin of 57.7% on a cumulative basis for nine months in 2022, resulting from favorable market conditions and sales capability despite rising costs,” the earnings statement said. “HMM will seek to maximize profitability by securing high-yield cargo and implementing cost-cutting measures by enhancing operational efficiency.” 

Looking ahead, the South Korean carrier said that “container demand is expected to be under downward pressure due to considerable uncertainties mainly related to widespread inflation, economic slowdown and geopolitical tensions.”

HMM added that weakening purchasing power and major retailers’ increased inventories also would negatively impact global container volumes. 

In July, HMM unveiled a $11.3 billion growth strategy that includes expanding its container ship fleet capacity from 820,000 twenty-foot equivalent units to 1.2 million TEUs, acquiring terminals and increasing its digitalization efforts. 

Yang Ming faces ‘uncertainty’

In its two-paragraph news release Thursday, Yang Ming Marine Transport Corp. reported after-tax profit in the third quarter in New Taiwan dollars of NT$49.75 billion ($1.7 billion), with earnings per share of NT$14.25. 

Q3 consolidated revenues totaled NT$99.81 billion ($3.41 billion), Yang Ming said. The Taiwanese carrier did not provide comparisons to prior quarters, but in August, Yang Ming reported Q2 consolidated revenue, converted to U.S. dollars, totaled $3.8 billion. 

The Taiwanese carrier said Thursday its after-tax profit for the first three quarters of 2022 “improved” by 50.95% year over year to NT$165.86 billion ($5.66 billion). Consolidated revenues for the first three quarters totaled NT$315.96 billion ($10.79 billion). 

“In the first three quarters of 2022, the ongoing Russia-Ukraine war and global inflation surge had an impact on the container shipping industry,” the Yang Ming statement said. “The unresolved port congestion and stalled U.S. West Coast contract negotiations also added uncertainty in the supply chain. In the face of these challenges, Yang Ming will continue to maintain schedule integrity and remain cautiously optimistic in the fourth quarter.” 

HMM growing container ship fleet as part of $11B investment

Yang Ming: Revenue up nearly 50% — end of story

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Editor: Kim Link Wills