In 2023, the South Korean shipping company HMM’s profits stood at 1,060 billion won ($ 760 million) .i.e. -90% on the previous year.
This poor financial performance is due to weak transport demand and falling freight rates on all shipping routes. It is no coincidence that revenues dropped 55% year-on-year to 8.4 trillion won.
In a press release, the company states that disruptions in the Red Sea region and the severe drought in the Panama Canal have limited daily ship transits, leading to widespread uncertainty and volatility in the market.
HMM points out that it will be taking delivery of twelve 13,000 TEU boxships this year, giving it a total capacity of 1 million TEUs. Once all these vessels have been delivered, its large 10,000+ TEU containerships will account for 80% of HMM’s fleet, substantially improving cost structure and operational efficiency.
Finally, the carrier says it is focusing its effort on improving its commercial capacity in order to provide a rapid response to a continually evolving market. A commitment that it intends to pursue regardless of the outcome of the company’s privatization.
As is well known, negotiations to sell HMM between public creditors Korea Development Bank (KDB) and Korea Ocean Business Co (KOBC) and the potential buyer and preferred bidder, the Harim Group, stalled due to a profound difference of opinion on the company’s management rights.
Translation by Giles Foster
