SIMIC

Yang Ming reported an earnings before interest and taxes (EBIT) margin of almost 56 per cent for the first half of 2021, while Evergreen's operating profit margin was 53 per cent.

By comparison, Maersk, the world's largest carrier and a financial bellwether, reported an EBIT margin for the first half of 30.6 per cent, and Hapag-Lloyd reported an EBIT margin of 33.1 per cent.

Taiwan's three main container shipping companies - Evergreen, Yang Ming, and Wan Hai - rode the high demand and elevated rates momentum generated in the first quarter through June, joining their industry peers in posting significantly improved financial results.

Yang Ming, which only returned to profitability in the third quarter of 2020 after posting losses every quarter for the previous two years, reported the largest financial turnaround of the Taiwan-based lines. Since then, the carrier has steamed through successive profitable quarters, reporting a US$1.2 billion net profit in the second quarter of 2021 compared with a $2.2 million loss during the same period a year earlier.

Yang Ming's revenue in the second quarter was $2.62 billion, with average rates per TEU increasing 10 per cent through the period to $1,890. The carrier raised EBIT to $660 million, a result that took its operating margin over 55 per cent for the first time.

Wan Hai reported a net profit of $674 million in the second quarter, with revenue of $1.7 billion almost five times higher year over year. Operating profit reached $820 million. Evergreen reported net profit of $1.5 billion for the quarter ended June 30 on revenue of $3.5 billion. Neither carrier disclosed its second-quarter volume or revenue per TEU figures.

An analyst at Alphaliner said the collective revenues of Maersk, Hapag-Lloyd, Zim Integrated Shipping Services, Ocean Network Express, HMM, Evergreen, Yang Ming, and Wan Hai are more than $70 billion for the first half of 2021, with more than $25 billion in EBIT.

The analyst said these carriers expect another increase in profit in the second half of the year as capacity remains tight and congestion continues to push rates up.

"The group operates a disproportionate amount of capacity on the east-west mainline routes where profits are currently highest; it now seems certain operating profits for the carrier segment as a whole will breach the $100 billion mark in 2021," the Alphaliner analyst noted.