However, the South Korean ocean carrier recorded a deeper net loss for the year, partly due to a 479.5 billion won loss in the book value of 10 containerships sold to Korea Shipping and Maritime Transportation in March 2017.
South Korea’s largest ocean carrier, Hyundai Merchant Marine (HMM), said Tuesday that its operating loss was smaller in 2017 than in 2016, and that revenues were up about 10 percent in 2017 over the prior year amid higher container volumes.
The company said that in response to the higher volume of business, it plans to acquire 30,170 new containers – 11,850 TEUs and 18,320 FEUs – for 100 billion South Korean won (U.S. $95 million).
The Seoul-based carrier, the 14th largest in the world according to Alphaliner, said it was ordering the new containers because of increased volumes.
HMM’s net loss was higher in 2017 than in 2016, with the company saying this was due, in part, to a 479.5 billion won loss in the book value of 10 containerships sold to Korea Shipping and Maritime Transportation in March 2017. The carrier’s net loss for 2017 totaled 1.209 trillion won in 2017 compared with a net loss of 484 billion won in 2016.
A company spokesperson commented that though the amount of net loss looks doubled year-over-year, this was not due to sales, but reflects asset sales in 2016, including stakes of Hyundai Securities, Hyundai Pusan new port terminals and HMM’s dedicated bulk business.
The company said its revenue improved, rising 10 percent from 4.58 trillion won in 2016 to 5.03 trillion won in 2017. However, HMM’s operating loss stood at 407 billion won in 2017 versus an operating loss of 833 billion won in 2016.
The company handled 4.03 million TEUs in 2017, a 30 percent increase over 2016.
As evidence of its improved financial condition, HMM said its debt to equity ratio decreased from 349 percent to 298 percent as a result of the issuance of perpetual convertible bonds and a paid in capital increase in 2017.
