The revised guidance
comes as the German shipping line released preliminary figures for the first
nine months of 2024, reporting Group EBITDA of approximately USD 3.6 billion
(EUR 3.3 billion) and Group EBIT of about USD 1.9 billion (EUR 1.8 billion).
“Given the current
course of business, characterized by stronger than expected demand and improved
freight rates, and despite increased expenses related to the necessary
diversion of vessels around the Cape of Good Hope, the Executive Board of
Hapag-Lloyd AG is raising its earnings outlook for the financial year 2024,”
the company said in a statement.
Hapag-Lloyd now expects its Group EBITDA to range
between USD 4.6 to 5.0 billion, up from the previous forecast of USD 3.5 to 4.6
billion. Group EBIT is projected
to rise to USD 2.4 to 2.8 billion, compared to the earlier estimate of USD 1.3
to 2.4 billion. However, the company warned that the volatile freight market
and geopolitical uncertainties could still pose risks to its forecast.
Final figures for the
first nine months of 2024 are set to be published on November 14, 2024.
Hapag-Lloyd’s revised earnings outlook comes
shortly after its future Gemini partner, A.P. Moller – Maersk, also raised
its full-year financial guidance for the fourth
time this year. The improved outlooks
come as the shipping industry faces significant disruptions due to the
instability in the Red Sea, where Houthi-led attacks on shipping routes
continue to impact global shipping.
In a trading published
earlier this week, Maersk revealed impressive Q3 results, including US $15.8
billion in revenue and an underlying EBITDA of US $4.8 billion.
As a result, Maersk
upgraded its full-year forecast to an underlying EBITDA of US $11.0-11.5
billion, citing strong demand and persistent disruptions in the Red Sea region.
As recently as this past February, the company expected 2024 EBITDA to be in
the range of just US $1-6 billion.
The instability in the
Red Sea has also led Hapag-Lloyd and Maersk to adjust their operational
strategies for Gemini’s launch in February. Due to safety concerns, the
companies have opted to continue to reroute ships via the Cape of Good Hope to avoid the
volatile Suez Canal route, a move that increases both transit time and costs
but ensures greater safety for vessels and crews The alliance will implement a
hub-and-spoke strategy across seven trade lanes, aiming for a 90% service
reliability rate—a significant improvement over the current industry average of 53%.
As geopolitical tensions escalate in critical
regions like the Red Sea, the global shipping industry faces an increasingly
turbulent landscape. These disruptions are forcing carriers to adapt by rerouting vessels
and adjusting operational strategies, reshaping traditional trade routes. While
these challenges raise transit times and costs for shippers, they are also
fueling a surge in freight rates, ultimately boosting the profitability of
ocean carriers.