German container shipper Hapag-Lloyd on Thursday said volatile economic and political environment will see an overall decrease in the company’s earnings in 2024.

However, the top management Rolf Habben Jansen claims the company achieved the third-best Group profit in the history of the company, even if it is significantly lower than it was in the exceptionally strong year 2022 due to the normalisation of global supply chains.

“We have got the current financial year off to a satisfactory start, but the economic and political environment continues to be volatile and challenging, especially in view of the current situation around the Red Sea. We therefore expect to see an overall decrease in earnings in 2024,” said chief executive Rolf Habben Jansen.

The company posted in its 2023 annual report a significant decrease in earnings. According to the report, the Group Ebitda stood at $4.8 billion (€4.5 billion).

The Group Ebit experienced a year-on-year decrease to $2.7 billion (€2.5 billion), and the Group profit to $3.2 billion (€3 billion).

Hapag-Lloyd is among a number of commercial shippers that have been skipping the Suez Canal after Yemen’s Houthis began attacking ships, rerouting via the Cape of Good Hope, which adds weeks to voyages and significant costs.

For the current 2024 financial year, the executive board of Hapag-Lloyd AG expects the Group Ebitda to be in the range of $1.1 to 3.3 billion (€1 to 3 billion) and the Group Ebit to be in the range of USD minus 1.1 to 1.1 billion (EUR minus 1 to 1 billion).

However, this forecast “remains subject to considerable uncertainty given the volatile development of freight rates and geopolitical challenges,” as the container giant says.

The company’s current fleet consists of 266 container ships and a total transport capacity of 2.0 million TEU.

Source: Hapag-Lloyd