Hanjin Shipping has returned to the black for the first quarter of 2015, posting a net profit of KRW22.9 billion (USD21 million), reversing its first-quarter 2014 loss of KRW224.5 billion.
The biggest container shipping company in South Korea reported total sales of KRW2.1 trillion and an operating profit of KRW155 billion.
Hanjin said, “Despite the shipping industry’s typical off-season, our total sales increased by 0.5% from a year earlier. We successfully achieved operating profit for four consecutive quarters thanks to various unit cost improvement efforts that boosted cost saving.”
The company’s operating profit of KRW155 billion is Hanjin’s largest achievement since the company posted an operating profit of KRW370.5 billion in the third quarter of 2010. The operating profit comprises earnings from the company’s core shipping business and excludes revenues from other sources.
Hanjin’s container volumes fell 0.7% year on year (y/y), but the division’s total sales climbed 2.2% with an operating profit of KRW163 billion.
Hanjin explained, “Improvement of these figures was possible through rationalisation of service network and dramatic cutback of cargo variable expenses and bunker cost.”
Meanwhile, the bulk business division recorded an operating loss of KRW28.3 billion, down 23.7% compared with its operating loss in the first quarter of 2014 because of the slow market. Hanjin’s terminal operations operating profit increased significantly to KRW19.4 billion, or 189.6% y/y.
Hanjin concluded, “By building [an] all-year-round low-cost structure and strengthening core capability of the company, we are concentrating all our efforts to maintain stable figures.”