Hapag-Lloyd has reported significantly improved earnings for 2019 saying that positive business developments have improved freight rates as well as rigorous cost and revenue management, improving the company’s returns.
On the basis of preliminary figures, Hapag-Lloyd’s earnings before interest and taxes (EBIT) for the 2019 financial year significantly increased to US$875 million (2018: US$480 million). Earnings before interest, taxes, depreciation and amortisation (EBITDA) rose to US$2,145 million (2018: US$1,23 million).
The 2019 results include effects from the first-time application of the IFRS 16 accounting standard, which amounts to approximately US$33 million for the EBIT and approximately US$504 million for the EBITDA. In the fourth quarter of 2019, both the EBITDA of US$513 million (Q4 2018: US$353 million) and the EBIT of US$183 million (Q4 2018: US$155 million) were also above their prior-year levels.
Revenues increased in the 2019 financial year by approximately 9%, to US$13.6 billion (2018: US$12.5 billion). Hapag-Lloyd says this can be attributed to an improved average freight rate of US$1,072 /TEU for the year as a whole, which rose by 2.6% year-on-year (2018: US$1,044 /TEU) due to a stronger focus on more profitable trade lanes and active revenue management.
In addition, a 1.4% year-on-year increase in transport volumes, to more than 12 million TEU (2018: 11.9 million TEU), and a stronger US dollar exchange rate against the euro also made a positive contribution to revenues, adds the German firm.
Lower expenses for the handling and inland transport of containers as well as a slightly lower average bunker consumption price of US$416 per tonne (2018: US$421 per tonne) had a positive effect on transport expenses, which increased to a total of US$ 10.5 billion (2018: US$ 10.4 billion), also impacted by a stronger US dollar, according to Hapag-Lloyd.
The Hamburg-based container shipping company will publish its 2019 Annual Report and an outlook for the current financial year on 20 March 2020.
