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Hapag-Lloyd nine-month profit more than doubles; more muted market seen

By Vera Eckert

FRANKFURT (Reuters) -German container shipper Hapag-Lloyd said nine-month net profit more than doubled thanks to higher freight rates and the company also stuck with its full-year guidance despite what it said was a more muted market.

Disruptions to global supply chains, originally caused by the coronavirus pandemic, have resulted in longer turnaround times for ships and containers, pushing up rates.

But by the end of the third quarter, weaker demand for container transport had become noticeable, Chief Executive Rolf Habben Jansen said in a statement.

"This is evident, for example, in falling spot rates and rising inflation-related unit costs," he said.

Jansen also noted that there has been a slight easing in the shortage of available shipping capacity which should help global supply chains normalise.

Net profit came to 13.8 billion euros ($13.8 billion) for the first nine months of 2022, up from 5.6 billion euros in the year-earlier period.

Earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 129% to 15.6 billion euros during the nine-month period and is expected to come in between 18.2 billion and 20.1 billion euros for the full year.

The world's No.5 container shipping firm said it had benefited from average freight rates of $2,938 per twenty-foot equivalent standard container unit, up 62% from a year earlier.

But an average 67% rise in shipping fuel prices to $755 has resulted in higher expenses, it added.

The outlook for container shipping, a bellwether of global economic trends, has deteriorated as economies around the world grapple with sharply spiking inflation and cost-of-living crises in the wake of Russia's invasion of Ukraine.

"Our strong balance sheet will help us to stay on course even in difficult waters," Jansen said, adding the company would continue to focus on investments in port terminal infrastructure.

Bigger rival Maersk warned of slowing demand for the transport and logistics sectors last week and cut its forecast for container demand this year, although it beat third-quarter earnings expectations.

($1 = 0.9972 euros)

(Reporting by Vera Eckert; editing by Maria Sheahan and Edwina Gibbs)