Evergreen profit soars nine times to US$9.5 billion in 2021

Evergreen Marine Corporation’s net profit rocketed nine-fold to US$9.5 billion in 2021 and its president Eric Hsieh said today (15 March) that the company expects to repeat its stellar performance in 2022, as congestion in the major US and European ports continues.

Speaking at a press conference to announce Evergreen’s 2021 results, Hsieh said there are five reasons why freight levels will remain high.

He noted, “Firstly, demand exceeds the supply of shipping capacity. Customers are also committing to long-term contracts for shipments to the US and Europe, at higher rates. The third is that port congestion continues, and shipping companies are under pressure. The fourth is that US port workers’ wage negotiations won’t be smooth. Lastly, you have 40, 50 ships tied up in congestion. Although there the Russo-Ukraine war continues, we think this won’t be prolonged as the global economy will be affected.”

A surge in online retail sales as more people telecommute amid the pandemic has fuelled shipping demand, resulting in a second straight year of record earnings for liner operators.

At the same time, Evergreen’s 2021 revenue was 236% higher compared to the previous year, reaching US$17.67 billion. Transpacific volumes account for 60% to 70% of Evergreen’s revenue, while Asia-Europe cargoes contribute the remaining 30%.

“It won’t be easy for freight rates to come down, so we’re optimistic about this year,” pointed out Hsieh, who added that while the industry is still seeing tight capacity, Evergreen’s fleet continues to expand.

In 2022 and the next three and a half years, there are about 42 new ships to be delivered, with a total capacity of more than 550,000 TEU joining the Evergreen fleet. According to internal estimates, the carrier’s capacity will increase around 11%.