GERMAN shipping giant Hapag-Lloyd posted a 56.6 per cent decline in year-on-year first quarter group profit to US$2.03 billion drawn on revenues of $6.13 billion, down 29.9 per cent.

Transport volumes were 4.9 per cent lower than in the first quarter of last year owing to local destocking and weaker overall global demand. In addition, the lower average freight rate of $1,999 /TEU (Q1 2022: $2,774/TEU) was responsible for the decline in revenue, which decreased to $6 billion.

Transport expenses remained at the prior-year level of $3.3 billion. The lower transport volumes were accompanied by inflation-related cost increases and a higher bunker consumption price.

"Despite declining results, we have made a robust start to the current financial year," said Hapag-Lloyd CEO Rolf Habben Jansen.

"The market environment has normalised, with corresponding declines in demand and freight rates. This will undoubtedly have an impact on our earnings over the course of the year, so we will be keeping a very close eye on our costs," he said.

For the full year 2023, Hapag-Lloyd confirms the forecast it published on March 2. EBITDA is expected to be in the range of $4.3 billion to $6.5 billion and EBIT to be in the range of $2.1 billion to $4.3 billion.

However, the ongoing war in Ukraine, other geopolitical uncertainties and persistent inflationary pressures are creating risks that could negatively impact the forecast.

Hapag-Lloyd has a fleet of 250 containerships and a total transport capacity of 1.8 million TEU and 14,100 employees in 400 offices in 135 countries.