Yang Ming Reports Net Loss of $41mln in Q2
Taiwanese ocean shipping company Yang Ming Marine Transport Corporation reported a consolidated revenues of about NTD 40.4 billion (USD 1.3 billion) for the second quarter of 2019, up 20.24% compared to the same period of prior year.
Business volumes increased by 5% year-on-year to 1.35 million TEUs. Net loss for second quarter of the year was NTD 1.27 billion (USD 40.99 million).
Meanwhile, Yang Ming’s consolidated revenues for the first half of 2019 rose by 16.77% compared with the same period in the previous year to NTD 75.48 billion (USD 2.44 billion), an increase in business volume of 5% to 2.64 million TEUs. The net loss for the first half year was NTD 1.95 billion (USD 62.94 million).
As reported by analyst firm Alphaliner, the container shipping market remains under pressure due to oversupply capacity in the first half year.
According to its latest projection for 2019, global throughput is estimated to grow at 2.5% while capacity is predicted to grow at 3.1%. The market demand is weaker than expected since the ongoing US-China trade conflict has weighed on the global economy.
In addition, the slight rise in bunker fuel prices affected Yang Ming’s operating costs. Furthermore, the exercise of the new IFRS 16 accounting standard had a negatively impact on Yang Ming’s half-year profitability by around NTD 0.6 billion (USD 19.37 million). Consequently, the company’s operating performance was insufficient to yield profits in the first half of 2019.
Nevertheless, Yang Ming has reduced its financial losses significantly by 66.22% as compared to the previous year, largely due to the result of its strategies implementation and cost control.
Furthermore, the Taiwan Ratings Corp. has affirmed a stable rating for Yang Ming’s outlook in the long term. This result reflects Yang Ming’s improved cost structure driven by its fleet optimization plan.
Since last year, Yang Ming has begun the deployment of its new eco-type containerships while returning some of its higher cost chartered vessels. Through its strategic fleet deployment along with THE Alliance’s expanded partnership and future new service network, Yang Ming will continue to enhance business competitiveness and provide global customer with more excellent and comprehensive service quality.