Evergreen Marine Corp., part of Asia’s second-biggest container line, suffered a 98 percent decline in second-quarter profit after cargo rates fell.
Net income was NT$81 million ($2.8 million) in the three months ended June 30, compared with NT$4.12 billion a year earlier, based on first-half results announced today by the Taipei-based company. The figure was in line with the NT$81.9 million average of seven analyst estimates compiled by Bloomberg.
Container rates have tumbled this year as expansion in the global fleet outpaces demand for shipments of Asian-made toys, furniture and auto parts to the U.S. and Europe. Fuel prices also averaged 35 percent higher than a year earlier, contributing to losses at China Cosco Holdings Co. and Neptune Orient Lines Ltd., the parents of Asia’s first and third-ranked container lines.
Evergreen climbed 0.8 percent to NT$18.60 at the 1:30 p.m. close in Taipei trading, before the earnings announcement. The stock has fallen 39 percent this year, compared with the benchmark Taiex Index’s 17 percent decline.
First-half net income was NT$1.39 billion, compared with NT$4.03 billion a year earlier, Evergreen said in a Taiwan stock exchange statement today.
China Cosco’s container revenue fell 3.4 percent in the first half, even as volumes increased 9.8 percent. Its average rates on trans-Pacific routes declined 4 percent, while Asia-Europe rates dropped 28 percent, according to Bloomberg calculations.