Global shipping giant Hapag-Lloyd anticipates that the strained situation in the global supply chains will ease in the second half of 2022.

In its recently released annual report, Hapag-Lloyd expects earnings to be very strong in the first half of 2022.

Earnings before interest, taxes, and amortization (EBITA), which is a measure of company profitability used by investors, is expected to be in the range of US$12 billion to $14 billion (€10.7 billion to €12.4 billion) and Earnings before interest and taxes (EBIT) is to be in the range of US$10 billion to $12 billion (€8.9 billion to €10.7 billion).

However, this forecast remains subject to considerable uncertainty given the ongoing COVID-19 pandemic and current developments in Ukraine. The company’s revenues increased to roughly US$26.4 billion (approximately €22.3 billion).

Higher freight rates drove up revenues

This can mainly be attributed to a higher average freight rate of US$2,003 per twenty-foot equivalent unit (TEU) (2020: US$1,115/TEU). Revenue growth was attributed mainly to a higher average freight rate of US$2,003/TEU (2020: US$1,115/TEU).

Transport volumes were roughly on par with the prior-year level, at 11.9 million TEU (2020: 11.8 million TEU) due to the strained supply chains. At the same time, transport expenses rose very significantly, by 17.1 per cent.

This was particularly due to higher bunker prices and charter rates as well as increased demurrage and storage fees.

Commenting on the positive performance, Rolf Habben Jansen, CEO of Hapag-Lloyd AG said, “We look back on an exceptionally successful year in which we invested massively in modern vessels and new containers. In addition, we have significantly strengthened our financial and asset position. However, transport expenses have unfortunately also risen significantly, mainly due to the bottlenecks in the global supply chains.”

In 2021, the net debt was completely paid off. At the end of the year, the liquidity stood at roughly US$8.7 billion (approximately €7.7 billion). It thereby significantly exceeded financial debt, with the result that Hapag-Lloyd had net liquidity of around US$2.5 billion (€2.2 billion) as of December 31, 2021.

According to Jansen, “The 2022 financial year has gotten off to a successful start for us, but the disruptions in the supply chains have not eased materially yet. In addition to that, we all face the terrible war in Ukraine. We stand united with the international community, have stopped our bookings to and from Russia, and call for de-escalation and peace.

He contended that the safety and well-being of all employees continue to be its top priority adding, “we will also do whatever we can to provide humanitarian support.”