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HONG Kong's Orient Overseas (International) Ltd (OOIL), now a Cosco unit and holding company of Orient Overseas Container Line (OOCL), has logged its best-ever first-half net earnings of US$2.8 billion with the company maintaining a bullish outlook for the coming months.
Turnover more than doubled compared with the same period of 2020 to just under $7 billion, with revenue from OOCL's liner services soaring 108 per cent to $6.5 billion, according to media reports.
OOCL Logistics saw a 15 per cent increase in its revenue, despite what OOIL described as "fierce competition" in the forwarding sector.
OOCL's liftings increased by 19.5 per cent on H1 20, reflecting the demand slump from Covid lockdowns, to 3.93 million TEU, for an average rate of $1,652 per TEU, 74 per cent higher than the year before.
OOIL said the outlook for its liner arm for the remainder of 2021 and the early part of 2022 "seems promising", but beyond that "is simply impossible to predict".
"Demand in key importing economies has been considerably stronger than forecast, especially on transpacific routes," said OOIL. "We have worked hard to inject additional capacity into key routes on our network in order to provide further space for our customers, and we continue to do so."
OOCL's carryings on the transpacific were up 17.2 per cent, to 1.10 million TEU, and although the comparison is skewed by the pandemic outbreak, quarter-on-quarter it still recorded an uplift of 9.9 per cent, to 540,070 TEU on the route.
OOCL's biggest region and showing the largest quarter-on-quarter volume rise of 20.5 per cent to 874,927 TEU, were its intra-Asia/Australasia services.
Nevertheless, OOIL said that despite its efforts to increase capacity, "numerous operational challenges" and "stronger-than-expected demand" had created a "severe imbalance" in supply and demand. But it conceded that OOCL's business had benefited significantly from the supply chain disruptions.
"These market forces have put upward pressure on freight rates on most tradelanes, and it is these market forces, in addition to our usual careful attention to cost control, that have driven the strong profitability achieved during the period," it said.
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