Continued Surge in Maritime Freight Rates Due to Red Sea Risks
HMM's operating profit in the second quarter of this year reached 650 billion KRW, more than quadrupling compared to the same period last year. This was due to sea freight rates remaining more than twice as high as last year.
On the 13th, HMM announced preliminary results for the second quarter of this year, reporting consolidated sales of 2.6634 trillion KRW and an operating profit of 644.4 billion KRW. Compared to the same period last year, sales increased by 25.0% and operating profit by 302.2%. Net profit for the period was recorded at 660.8 billion KRW, up 112.4% during the same period. The operating profit margin was 24.2%, the highest level among global shipping companies.
This is attributed to the impact of the Red Sea incident, which caused the Shanghai Containerized Freight Index (SCFI) to rise from an average of 976 points in the first half of last year to 2,319 in the first half of this year, more than doubling. Additionally, HMM strengthened profitability-focused operations and improved its structure by deploying eco-friendly vessels and ultra-large ships, thereby enhancing performance and competitiveness.
HMM still considers the market to be full of uncertainties and plans to diversify its business in advance and focus on generating new revenue streams. HMM stated, "In the container sector, stable consumer demand is expected due to the U.S. economic recovery, easing inflation, and expectations of interest rate cuts; however, rapid changes in market conditions due to geopolitical risks remain possible. According to the mid- to long-term fleet plan, we will build an optimal transportation service network tailored to changes in supply and demand by route and region, including securing new and secondhand vessels and opening a new Mexico route (FLX line), while focusing on business diversification and new revenue generation."
It added, "In the bulk sector, tanker demand is expected to increase due to rising crude oil demand compared to the first half of the year, but economic variables such as the global economic growth slowdown and inflation remain influential. We will strive to maximize profitability through cargo owner and cargo development by extending long-term cargo contracts and securing new contracts," it added.
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