Container line argues its merger with Cosco Shipping allows OOCL to respond more quickly to market changes by better matching its vessel capacity to cargo demand.
Hong Kong-listed Orient Overseas (International) Ltd (OOIL) is cautiously optimistic about liner shipping prospects this year, having posted a $108m net profit for 2018 versus $128m a year ago. Revenue increased nearly 10% year-on-year to $6.6bn in 2018, while liftings went up by 6.3% on average to 6.7m teu, growing 8.9% on Asia-Europe and 14.5% on the transpacific trade lanes.
The company, which was acquired by Chinese state conglomerate Cosco Shipping last year, said the growth drivers from China remained stable and strong, while a further opening-up of the country’s economy stipulated by Beijing, could provide new momentum to global trade. Also, the Belt and Road infrastructure initiative had created “significant opportunities”, especially for trade in emerging markets.
Moreover, the capacity growth of container shipping was now apparently slowing down, thus potentially helping to alleviate pressure on the supply side.
Although the group highlighted challenges including slowing global economic growth, uncertainties brought by trade conflicts and rising oil prices, as well as vessel oversupply in certain segments, OOCL co-chief executive Andy Tung argued that the merger had allowed his company to respond to market demand more quickly – for example, to shift its loadable capacity into other markets where the demand situation is better.
This is an edited extract from a longer article published in Lloyd’s List. Lloyd’s List subscribers can read the full original article via this link: OOIL cautiously optimistic about 2019
Source: Lloyd´s
