Shipping firms report double-digit growth
In this article (5)
Shipping companies have had one of their best quarters in years with most reporting double-digit growth thanks to high rates.
Vinalines, the country’s biggest shipper, saw a near doubling of its profits year-on-year to VND1.43 trillion (US$61.19 million) in the second quarter.
Private player Gemadept reported an 87 percent increase in profits to VND334 billion, the highest since the second quarter of 2018.
Hai An Transport and Stevedoring made it to the top three after profits rose 3.3 times to VND324 billion.
It was its most profitable quarter in nearly six years.
Vietnam Ocean Shipping JSC (Vosco)’s profits were only up 7.5 percent to VND260 billion, but it was its most profitable quarter in 14 years.
The Petrovietnam Transportation Corp (PVTrans)’s gross profit rose to a 15-year high of VND440 billion, but net profit fell 16 percent to VND265.5 billion as financial income decreased.
The industry attributed growth to high freight rates, which have quadrupled since 2020 to $8,000 for a 40-feet container, according to data brokerage Bao Viet Securities compiled from Bloomberg.
But market research firm FiinGroup warned that in the second half of this year the rates would fall and costs, especially of fuel, would rise.
It also expected China to continue with its zero-Covid strategy, which could drag demand down.
China accounted for a fourth of global goods throughput last year, according to data from its Ministry of Transport and German data portal Statista.
Questions & Answers
Q.Which specific companies saw a decline in their net profits despite the overall positive trend for the shipping industry?
Which specific companies saw a decline in their net profits despite the overall positive trend for the shipping industry?
Petrovietnam Transportation Corp (PVTrans) saw its net profit fall by 16 percent to VND265.5 billion. This was due to a decrease in its financial income, despite its gross profit rising to a 15-year high.
Q.What is the main reason cited for the strong performance of shipping companies in this quarter?
What is the main reason cited for the strong performance of shipping companies in this quarter?
The primary reason for the sector's growth is attributed to high freight rates. These rates have quadrupled since 2020, reaching $8,000 for a 40-feet container.
Q.What factors could negatively impact shipping rates and demand in the second half of this year?
What factors could negatively impact shipping rates and demand in the second half of this year?
Market research firm FiinGroup warned that rates would fall and costs, particularly fuel, would rise. China's continued zero-Covid strategy is also expected to reduce demand, as it accounts for a significant portion of global goods throughput.
Q.Which shipping company reported the highest percentage increase in profits during this period?
Which shipping company reported the highest percentage increase in profits during this period?
Hai An Transport and Stevedoring reported the highest percentage increase in profits. Its profits rose by 3.3 times, which was its most profitable quarter in nearly six years.
Reader pulse
Are shipping rates sustainable?
17,182 votes so far