Yang Ming hit by freight rate decline
Substantial declines in freight rates and excessive tonnages hit Taiwanese shipping company Yang Ming Marine Transport last year resulting in a net loss of T$15.8bn ($501m) compared with the profit of T$547mm a year earlier.
The company"s operating revenue slid 45% to T$74.5bn during the period compared with T$137.8bn in 2008.
Global container shipment demand significantly contracted during the period due to the global financial crisis. A 50% decline in freight rates on Europe, Asia and the US routes and overcapacity in the global shipping market caused the loss last year, the company said in a statement.
To cope with the downturn, Evergreen Marine employed a string of measures last year in order to reduce excessive tonnages, including scrapping old vessels, postponing new vessel delivery and returning charter-in vessels, and strictly controlling terminal operation expenses, the company said.
However this was not enough to offset the decline in container operation income, which fell by T$42.6bn, the company said.
Separately, the company"s dry bulk affiliate Kuang Ming Shipping recorded net profit of T$1.5bn last year against T$953m in 2008.
Yang Ming Marine Transport predicted average freight rates on major routes would bottom out this year and expected global shipping demand to rebound by 7.3% and 6.5% in 2010 and 2011, respectively. The company said it planned to open new routes and enhance operational efficiency in an effort to turn return to the black in 2010.