Following the “trend” of the last quarters and years, container lines have recorded very strong operating profits once again in the first quarter of 2022.
The combined operating profit of global carriers (those providing financial information), according to Danish container analysts of Sea-Intelligence, was US$43.9 billion in the first three months of the year.
“If we put it in perspective, this Earnings Before Interest and Tax (EBIT) is not only higher than the combined EBIT of the first quarter of the last 12 years, but it is also higher than the EBIT of the third quarter of 2021, which in itself was a bumper peak season,” said Alan Murphy, CEO of Sea-Intelligence.
In addition, all carriers have more than doubled their EBIT on an annual basis and most of the carriers have doubled their EBIT compared to their respective combined EBITs since 2010.
Four companies recorded 2022 Q1 EBIT of over US$5 billion, with CMA CGM coming first with US$7.64 billion, followed by Maersk with US$7.07 billion, COSCO with US$6.26 billion and Ocean Network Express (ONE) with US$5.23 billion, according to Sea-Intelligence data.
The following figure shows the EBIT / TEU of the ocean carriers reporting both EBIT and their global volumes, highlighting the size of the companies’ profitability.
“The unprecedented nature of the current supply/demand situation and the freight rate environment is clearly evident, with the 2022 Q1 EBIT/TEU figure of each of these shipping lines dwarfing each of the previous years,” commented Murphy.
This level of profitability is not driven by volume growth, as apart from ZIM (+5%), all other carriers that report global volumes either recorded sharp year-on-year declines, or in the case of Hapag-Lloyd, a marginal 0.4% increase.
“This level of profitability is more so a reflection of the current freight rate environment,” pointed out CEO of Sea-Intelligence.