German container shipping group Hapag-Lloyd swung to a first-half operating profit as it raised transport volumes and freight rates stabilised, but it still posted a net loss after higher ship fuel costs weighed on first quarter earnings.
Profit before interest and tax (EBIT) in the first six months came to 87.3 million euros ($104.55 million), up from a year-earlier loss of 39.7 million, the company said on Tuesday.
Hapag-Lloyd posted a first-half net loss of 46.1 million euros, paring heavy losses of 142.1 million in the same period a year earlier. It posted a 16 million euro net profit in the second quarter, compared with a 99.3 million loss last year.
Hapag-Lloyd said that EBIT, earnings before interest, taxes, depreciation and amortisation (EBITDA) and transport volumes in the full year will "clearly exceed previous year levels."
The company benefits from an ongoing consolidation in the sector where it has merged with Arab peer UASC to reap synergies and form the world's fifth largest shipping company.
"The market in container shipping remains challenging, but we have managed to make very good progress in the first half year of 2017," Chief Executive Rolf Habben Jansen said.
"We improved profitability significantly and the integration of UASC will be largely completed in the third quarter. That will allow us to start capturing synergies very soon after the integration."
Reporting by Vera Eckert