May 15, 2020 / 7:05 AM / 19 days ago

Hapag-Lloyd Q1 net profit down 74%, reiterates 2020 guidance

FRANKFURT, May 8 (Reuters) - German container shipping line Hapag-Lloyd on Friday reported a first quarter net profit of 25 million euros ($27.01 million), down from 96 million euro a year earlier, and held on to its earlier guidance for full year earnings.

Citing higher costs for shipping fuel and a devaluation of its bunker stocks triggered by an oil price slide, the company said the corona pandemic would hit activities in the second quarter, ahead of a hoped-for slow recovery.

Chief executive Rolf Habben Jansen said the crisis impact overshadowed what was otherwise a positive performance, with higher freight rate income and transport volumes.

“We adjust our service network to the lower demand and seek savings in all cost categories, from terminal, transport, equipment and network costs to overheads,” he said.

Habben Jansen last week had briefed reporters on planned cost savings measures in response to the crisis.

Transport volumes rose by 4.3% to over 3 million 20-foot equivalent units (TEUs) in the three-month period while freight rates rose by 1.4% to $1,094/TEU, the company reported.

First-quarter earnings before interest, taxes, depreciation and amortisation (EBITDA) decreased to 469 million euros, down from 489 million a year earlier.

Earnings before interest and taxes (EBIT) fell to 164 million euros after 214 million in comparable 2019.

Hapag-Lloyd upheld an EBITDA range of EUR 1.7 to 2.2 billion and an EBIT of EUR 0.5 to 1.0 billion for Calendar Year 2020, but stressed that unless conditions improved in the second half, the upper end of the forecast ranges would be barely achievable. ($1 = 0.9257 euros) (Reporting by Vera Eckert, editing by Edward Taylor)

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