Container Shipping Boom Continues: Hapag-Lloyd Hikes Outlook (Again)

As great as 2021 was for container shipping lines, this year is turning out better. Germany's Hapag-Lloyd has just raised its earnings outlook again.

The world's fifth-largest liner operator said Thursday that it will post earnings before interest, taxes, depreciation and amortization of $10.9 billion for the first half of this year.

This translates into EBITDA of $5.6 billion for Q2 2022, the best quarterly result in the company's history and up 145% year on year. Hapag-Lloyd reported EBITDA of $5.3 billion in the first quarter.

For the first half, volume came in at 6 million twenty-foot equivalent units, flat year on year. The average freight rate increased 80%, implying a rate of $2,902 per TEU for the first half.

Hapag-Lloyd's average freight rate was $2,774 per TEU in the first quarter, meaning that rates in the second quarter — including both contract and spot rates — rose even higher.

For full-year 2021, Hapag-Lloyd reported EBTIDA of $12.8 billion. In March, it projected this year's EBITDA would be $12 billion-$14 billion. In May, it pushed its outlook up to $14.5 billion-$16.5 billion.

On Thursday, it raised it significantly, to $19.5 billion-$21.5 billion, 52%-68% above last year's result. Hapag-Lloyd's outlook implies very strong results for the second half of the year of $8.6 billion-$10.6 billion.

According to Deutsche Bank analyst Andy Chu, "Even though our forecasts are significantly ahead of the market, today's new guidance — especially at the top of the range [with] management very conservative — is materially ahead of expectations. The company is making extraordinary profits."