On April 10th, COSCO Shipping and Evergreen Marine Corporation announced their first quarter earnings for 2023. COSCO Shipping's net profit decreased by 74.9% compared to the same period last year, while Evergreen's first quarter revenue dropped by 60%. In addition, Orient Overseas International announced last week that its Q1 total revenue decreased by 57.8% year-on-year.
On the evening of April 10th, COSCO Shipping Holdings released its Q1 2023 earnings forecast. According to the financial report, COSCO Shipping achieved a pre-tax profit (EBIT) of about RMB 10.525 billion in the first quarter of this year, a decrease of about 74.03% compared with the same period last year. The company's net profit in the first quarter was about RMB 6.933 billion, a decrease of about 74.91% year-on-year, and the net profit attributable to the parent company after deducting non-recurring gains and losses was about RMB 6.9 billion, a decrease of about 74.90%.
Just a week before, COSCO Shipping had announced its best annual performance ever, with a net profit of over RMB 100 billion in 2022. During the past three years (from 2020 to 2022) when container shipping rates soared, COSCO Shipping's performance achieved a "three-level jump" from billion-level to trillion-level profits.
COSCO Shipping said that in Q1 2023, due to changes in the supply and demand of container shipping industry, China's export container shipping price comprehensive index (CCFI) decreased by 68.45%. In the context of a higher base last year, the decline in the company's container shipping revenue compared with the same period last year led to a decrease in performance. Although COSCO Shipping's performance decreased year-on-year, it still maintained a strong profitability in the face of market fluctuations.
COSCO Shipping also stated that some trunk line shipping rates in the recent shipping market have stabilized, indicating the marginal improvement of supply and demand in the shipping market. However, challenges and uncertainties still exist, and the company will continue to pay close attention to the recovery of customer demand, guarantee transportation capacity, and actively seize market opportunities.
On April 10th, Evergreen Marine Corporation announced that its consolidated revenue in March was NT$21.885 billion, an increase of 17.15% from February, breaking a seven-month decline and turning positive. However, it fell by 62.7% compared to the same period last year, with consolidated revenue of NT$66.807 billion in the first quarter, a year-on-year decrease of 60.89%.
Evergreen Marine Corporation said that after the Spring Festival, the production lines gradually resumed work, and the export cargo volume in March increased significantly from February. According to the latest Shanghai Containerized Freight Index (SCFI) released by the Shanghai Shipping Exchange, the main east-west shipping route freight index has rebounded.
Evergreen further pointed out that with changes in international economic and trade relations, the recent increase in European cargo volume and the expected increase in shipment volume before the May Day holiday in China will help increase overall cargo volume and revenue in the future.
On April 6th, Orient Overseas International announced that its total revenue for Q1 ending March 31, 2023, decreased by 57.8% year-on-year to US$2.176 billion. The total cargo volume decreased by 3.2%, but the transport capacity increased by 0.7%. The overall transportation rate decreased by 3.3% compared to the same period last year, and the overall average income per standard container decreased by 56.4% year-on-year.
Specifically, Orient Overseas International’s revenue from the Asia-Europe trade decreased by 67.9% YoY to USD 489.5 million in Q1 2023, its revenue from the trans-Pacific trade decreased by 65.6% YoY to USD 649.8 million, and its intra-Asia/Oceania revenue decreased to USD 724.4 million, down 49.9% year-on-year in Q1 2023. Only Orient Overseas International's relatively small trans-Atlantic trade increased by US$311.9 million, a year-on-year increase of 4.7% in Q1 2023.
Industry analysts said that the container shipping market, which had experienced a surge in freight rates making it difficult to get containers, is gradually returning to rationality, and shipping companies are gradually emerging from decades of rare "bull market" cycles.
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