- Yang Ming recorded a $27m net loss for the first three months of this year
- It reported $11m loss by its dry bulk business.
- Yang Ming’s Q1 liftings were down 4% in the same period last year, to 1.24m teu.
- Yang Ming has a capacity of around 600,000 teu with 70% chartered-in tonnage.
According to an article published in The Loadstar and authored by Mike Wackett, Yang Ming recorded a $27m net loss for the first three months of this year.
First-quarter loss weaker than expected
It followed a loss of $144m for full-year 2019. The Taiwanese carrier attributed the first-quarter loss to “weaker than expected” container volumes and an $11m loss by its dry bulk business.
Yang Ming’s Q1 liftings were down 4% in the same period last year, to 1.24m teu.
However, there was just a 1% decrease in group revenue, to $1.15bn, as freight rates increased to mitigate the impact of IMO 2020 low-sulphur regulations.
Large scale capacity withdrawal
Yang Ming also warned that its revenue would fall further in the second quarter, “due to the large-scale capacity withdrawal”. But, it added, this would also result in a reduction in its costs.
In order to shore up the carrier’s balance sheet, Yang Ming’s board has approved a private placement for 300 million preferred shares in the company. The Taiwanese government already holds a 48% equity stake and it is expected to fund most, if not all, the new share offering.
Debt rating stays stable
Prior to the share placement, credit rating agency Taiwan Ratings downgraded Yang Ming’s debt rating from “stable” to “negative”, but subsequently said it considered “Yang Ming’s role and link to the government will remain intact”.
It added that the company would continue to benefit from favorable borrowing costs and sufficient liquidity support from banks in Taiwan.
About Yang Ming
Yang Ming is the eighth-ranked global container carrier in the world, with a capacity of around 600,000 teu, of which 70% is represented by chartered-in tonnage.
It also has an aggressive order book, which after the final delivery in 2021 will increase its fleet capacity by a third.
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Source: TheLoadstar
