Shipping giant Hapag-Lloyd rakes in $1.8 billion profit in Q3

 

BERLIN – The German shipping company Hapag-Lloyd says it has made a good profit so far this year, despite the economic downturn and several international crises.

The company reported in Hamburg on Thursday that it had made around €1.7 billion (about $1.8 billion) in profits in the first nine months of this year. For the year as a whole, Hapag-Lloyd expects earnings before interest and taxes (EBIT) of between €2.2 and €2.6 billion.

The reason for the positive balance sheet is higher-than-expected demand in the third quarter, and improved freight rates, which have outweighed higher expenses. These include the re-routing of ships around the Cape of Good Hope which became necessary due to attacks by Yemen’s Houthi militia, which is allied with Iran.

Houthi militants have repeatedly fired on merchant ships in the critical Red Sea shipping corridor that connects to the Mediterranean through the Suez Canal since the start of the war in Gaza on October 7 last year.

The militants have said the attacks are intended to support Hamas by making it more difficult for cargo ships to reach Israel.

“The first nine months of 2020 were characterised by unexpectedly strong demand,” said Hapag-Lloyd CEO Rolf Habben Jansen. Despite the tense security situation in the Red Sea, the transport volume continued to grow.

“At the same time, we have commissioned an extensive new building programme for 24 ships, which will further modernise and decarbonise our fleet, thereby securing our long-term competitiveness,” he said.