Yang Ming Shipping in Taiwan recently released its financial report for the second quarter of 2020. Although cargo volume dropped by 15% due to the epidemic, the profit of the container business segment reached US$18.6 million and turned a loss.
However, if we look at the entire group level, affected by the loss of approximately US$21 million in the dry bulk industry, the consolidated net loss of the entire group in the quarter reached approximately US$2.25 million.
In the first half of this year, compared with the first half of 2019, Yang Ming Shipping's revenue fell by 12% to US$2.2 billion, and container volume fell by 10% to 2.38 million TEUs. The net loss for the first half of the year was US$29.5 million, of which the dry bulk business suffered a loss of US$30.5 million.
Although the container shipping segment is profitable, the serious losses in the dry bulk segment have dragged down Yang Ming Shipping's overall performance. In the first half of the year, all major container shipping companies achieved good results. The company's overall performance was still in the red during the same period.
Under such circumstances, although the company said that its performance may improve in the third quarter of this year, it still decided to pay back the three rented dry bulk ships in the second quarter of next year.
In fact, Yang Ming Shipping stated that it will unlease all its long-term leased dry bulk vessels this year. The Taipei-listed shipping company said the move was part of its dry bulk business strategy.
In addition to the above three dry bulk ships, the company stated that it will return the remaining four long-term chartered ships between 2022 and 2025. According to Xinde Maritime Network, Yang Ming Shipping’s current chartered dry bulk vessels include 2 Capesize and 5 Panamax dry bulk vessels.
In addition, the company has 10 self-owned dry bulk ships, ranging from 62,000 tons to 82,000 tons, all operated by one of its subsidiaries called Kuang Ming.
In the container shipping industry, Yang Ming Shipping is currently the eighth largest container liner company in the world, operating 92 ships with a transport capacity of 620,000 teu. In addition, the company has orders for 19 ships with a total transport capacity of 165,000 teu.
The company said: “Looking ahead, as Western countries begin to adopt anti-isolation measures and manufacturing industries resume operations, trans-Pacific freight rates have surged to the highest level in 20 years.” Compared with the same period last year, freight rates on the Asia-Europe route There has also been some improvement. The company therefore intends to "seize the opportunity" of higher freight rates on the trans-Pacific and Asia-Europe routes and "expand its customer base".
At the same time, it will strictly control operating costs, including "optimizing container flow and minimizing container positioning costs" while reducing feeder and inland costs and fuel consumption, the company added.
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