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Hapag-Lloyd Forecasts Big Drop off after Record 2022 Profit

FRANKFURT, March 2 (Reuters) - German container shipper Hapag-Lloyd on Thursday posted a record profit of 17 billion euros ($18.08 billion) for 2022, 88% more than a year earlier, but said uncertainty around the Ukraine war and inflation would greatly temper earnings in 2023.

Hapag-Lloyd, the world's fifth-biggest container liner, benefited from exceptional freight rates through spring 2022, which helped it bolster its finances, invest in its fleet and make acquisitions.

But it has already warned that the party is over, as has bigger rival Maersk.

"Costs - such as for fuel, charter vessels and container handling - have risen significantly," Chief Executive Rolf Habben Jansen said in a statement.

"We have got the current financial year off to a decent start, but the economy has cooled and a significant decrease in earnings remains inevitable."

The company forecast 2023 earnings before interest, taxation, depreciation and amortisation (EBITDA) of 4-6 billion euros, compared with 19.4 billion in 2022.

It expects earnings before interest and taxes (EBIT) of 2-4 billion euros for 2023, following 17.5 billion euros in 2022.

The 2023 guidance is subject to considerable uncertainty due to Ukraine and other international conflicts as well as inflation, the company's statement said.

Hapag-Lloyd reported that revenue increased by 55% last year, to 34.5 billion euros, helped by a 43% increase in freight rates to $2,863 per twenty-foot equivalent unit (TEU).

Transport volumes remained at par with the previous year at 11.8 million TEU, but transport expenses rose 18.5% to 13.7 billion euros.

The pandemic disrupted logistics and clogged up ports, but those conditions had eased considerably by the end of 2022, by when per-unit costs had begun to rise. ($1 = 0.9400 euros)

Reporting by Vera Eckert, Editing by Rachel More and Savio D'Souza

Source: Reuters

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