South Korea’s largest container shipping company’s transported volumes ticked up 1 percent year-over-year in the quarter to 1.17 million TEUs, container revenues tumbled 26.6 percent year-over-year to 1.35 trillion won.
South Korean ocean carrier Hanjin Shipping posted a net loss of 212 billion South Korean won in the second quarter of 2016 compared with a net profit of 104 billion won in the second quarter of last year. The company said that was the equivalent of a $182 million loss, using the second quarter’s average exchange rate of won against the U.S. dollar, which it said was $1 for every 1,163.3 won. At Tuesday’s exchange rate it amounted to U.S. $194 million.
Sales for the second quarter of 2016 tumbled 27.5 percent year-over-year to 1.4 trillion won.
The company’s container and bulk divisions both lost money. The container division experienced an operating loss of 188 billion won in the second quarter compared with an operating profit of 62.6 billion won in the second quarter last year. The loss for the bulk division totaled 46.3 billion won in the second quarter of this year compared with a loss of 22.8 billion won in the second quarter of 2015.
Even though the company’s transported volumes ticked up 1 percent year-over-year to 1.17 million TEUs, container revenues fell 26.6 percent year-over-year to 1.35 trillion won.
In regards to the second half of this year, Hanjin said profitability is likely to improve resulting from increased transport volumes in line with the peak season and freight rate restoration efforts of carriers. “Added to that, continuous return of high cost charter vessels and efforts to improve supply and demand within the market are likely to lead upswing of freight rates,” the company said.
Hanjin noted the deadline for its conditional voluntary restructuring agreement has been extended by one month and it plans to wrap up meetings with bondholders, negotiations for charter rate adjustments and ship finance maturity adjustments in early September.
The company has also said that Hanjin Transportation, a different company in the Hanjin chaebol, is reviewing the option of taking over Hanjin’s Total Terminals International in Long Beach, but no decision has been made yet.
“For the remaining second half of the year, Hanjin Shipping will focus on recovering its sales power and maximizing its profitability for the earliest financial normalization of the company,” it added.
Hanjin posts net loss in Q2
