SEOUL : HMM announced its financial results for the first quarter of 2022, in which the company recorded record profits, mainly due to freight rates and efficient fleet operations.
More specifically, HMM’s net profit was US$2.4 billion (KRW 3,132 billion) with a margin of 64% in the first quarter of 2022.
The South Korean ocean carrier saw its revenue rise 103% in the first three months of the year, compared with the same period in 2021, reaching US$3.8 billion (KRW 4,919 billion).
Additionally, HMM’s operating profit trippled to US$2.5 billion (KRW 3,149 billion) in 2022 first quarter, from US$790 million (KRW 1,019 billion) in 2021 Q1. The operating margin has also increased to 64% in 2022 Q1 from 42% in 2021 Q1.
Meanwhile, the Shanghai Containerized Freight Index (SCFI) was 4,851 points in the first quarter of 2022, up 74.5% compared with the first quarter of the previous year, which helped HMM to have such positive results.
According to the company, world trade remained tense due to Russia’s invasion of Ukraine and strict lockdown measures in China in the first three months of 2022. “These uncertainties are still widespread and market volatility is expected to continue in the coming months,” said HMM in a release.
Another factor that will affect global supply chains, according to the Seoul-headquartered box line, is the contract negotiations between the International Longshore & Warehouse Union (ILWU) and Pacific Maritime Association (PMA), scheduled on the west coast of the United States.
HMM warns that high inflationary pressures could negatively affect the increase in demand in Asia-North American trade, which has the highest percentage of its business portfolio. However, HMM expects container volumes to rise moderately, resulting in the gradual easing of the lockdown in Shanghai and the demand for inventory replenishment in the United States.