Monday, August 6, 2012
Orient Overseas profits plunge 33 percent
Hong Kong’s Orient Overseas saw profits plunge 33 percent in the first half of 2012 due to high fuel costs, the company announced Wednesday.
The container line’s net income dropped to $117 million from $175 million year on year, according to a company statement. Sales increased by 7 percent to $3.1 billion.
Orient Overseas said it paid approximately $689 per ton for fuel in the first half, 16 percent more than during the same time period in 2011.
Shipping lines have raised rates to balance higher fuel costs and vessel overcapacity. Even so, CFO Kenneth Cambie said in the fourth quarter rates may fall again after the peak season.
Asia-Europe route rates have doubled year on year to $1,888 per-TEU on June 30, according to Geoffrey Cheng, a Hong Kong-based analyst at Bank of Communications, up from the $1,660 per-TEU rate at the end of March.
The company handled 2.59 million TEUs in the first half, a 6.1 percent increase from a year earlier, it said in a July statement.
For more of the Bloomberg story: www.bloomberg.com
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