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OOIL posts US$219 million loss due to ‘one of most difficult markets’ ever

Tue 14 Mar 2017 by Rebecca Moore

OOIL posts US$219 million loss due to ‘one of most difficult markets’ ever
OOIL and its box shipping arm OOCL plunge into red in 2016

Orient Overseas International Ltd (OOIL) container and logistics business has reported EBIT of negative US$185 million in 2016 versus a US$294 million EBIT profit in 2016 due to “one of the most difficult markets” in the industry’s history.

And for the full year 2016, its container arm OOCL’s liftings were up 9.1 per cent, but with a drop in revenue of 9.9 per cent.

Its parent company OOIL has announced an overall loss attributable to equity holders for 2016 of US$219 million, compared to a profit of US$284 million in 2015.

The chairman of OOIL, Mr C C Tung, said: “This past year has seen some of the most difficult markets in our industry’s history. A combination of steady but low growth in most regions and an overhang of excess supply built up in recent years led to extremely challenging conditions in many trade lanes for most of 2016.”

“As fuel prices rose in the second half of the year, industry performance was badly affected by freight rates that frequently sank below the levels seen in 2009.”

“The financial results reported by the industry as a whole give a clear indication of just how severe conditions became. A quarter-by-quarter or half-by-half analysis of industry results since the middle of 2015 paints a picture of strengthening headwinds,” said Mr Tung.

He said that “OOCL continues to build its future on the twin pillars of alliance membership and the efficient operation of the most appropriate vessels for each trade lane”.

OOCL’s 20,000 teu class of vessels enter service in 2017.

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