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Shipping company HMM racks up a $720m annual loss

February 14, 2019, PortandTerminal.com

Seoul, South Korea – South Korean flagship carrier HMM has revealed a net loss of KRW808bn ($720m) for the full financial year, marking it out as one of the biggest losers among the world’s top 10 liners. Analysts at box watchers Alphaliner described HMM’s results as “dismal” in their latest weekly report.

HMM, which went through a major restructuring three years ago, cited increased bunker costs, Iranian sanctions and a delay in rate recovery as reasons for the huge loss. HMM’s revenues stood at a record KRW5.22trn in 2018 and its debt ratio, although still high, improved from 301.6% to 282.4%. HMM moved a record 4.46m teu last year, up 10.6% year-on-year, grabbing market share at the expense of profits.

On the market outlook, HMM stated in a release: “Uncertainty over the cargo volumes in 2019 will continue due to the concerns on a global economic slowdown, Brexit, and the US-China trade conflict.”

After the bankruptcy of Hanjin in 2016, South Korea has struggled with its status in world shipping, its new flag-carrier, HMM, forced to play a bit part in a slot chartering role with the 2M Alliance, after being rejected by THE Alliance due to financial concerns. The dismal results announced by HMM, while expected, will not bolster its status.

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