Hanjin first half losses hit $400 million

Hanjin first half losses hit $400 million    Hanjin Shipping posted a $400 million operating loss in the first half of 2009, a huge reverse on the $205 million it made in the corresponding period in 2008.
   The Korean carrier saw an operating loss of $223 million in the second quarter alone. The bulk of the first half loss came from the line's container division, which lost $342 million. Meanwhile, revenue slumped 39 percent to $2.5 billion in the first half. Net loss after tax and interest was $516 million.
   'Despite the loss in operating and net profit, the company is relieved to see a ray of light in the container transport volume, which jumped 22.7 percent quarter-on-quarter, contributing to 2.5 percent increase in total sales of $1.29 billion (from the first to second quarter). Hanjin Shipping believes that the container liner business will finally start to pick up, driven by the recovery in the global economy. On the other hand, bulk liner business experienced some drop in total sales, down from $289 million to $227 million due to downsized fleet and reduced volume accompanied by declining rates.'
   The carrier attributed the container losses to declining freight rates in the transpacific. Also adding to the net loss was the expenses incurred from the closedown earlier this year of the company's former German affiliate, Senator Lines, and the loss made by its subsidiaries.
   'The company has been trying to secure equity in preparation for future,' Hanjin said. 'Despite the various signals indicating the recovery in the global economy, the company believes that the actual recovery in the shipping industry will take some time. Hanjin Shipping has been putting a lot of efforts in securing equity through various measures, including a rights issue.'
   The carrier also received aid from a fund, the Korea Asset Management Corp., though the amount KAMCO contributed was not specified.
   'Hanjin Shipping is optimistic about the upcoming season as it foresees the container division to benefit from the continuing recovery in the global economy and higher demand during the seasonal peak season,' the carrier said. 'The container carriers are also expected to improve profitability as a whole with attempts to recover the previous freight level. Furthermore, in light of the increased raw material imports by China and higher production rates in steel manufacturers, the bulk division forecasts a higher volume next quarter.'