Hyundai Merchant Marine (HMM) expects container demand to be "under downward pressure" in the next few months as uncertainties in the market remain.
The South Korean shipping company made the comment as it reported high revenue in the third quarter of 2022 on the back of persisting high cargo yields.
HMM said its third-quarter revenue was up 27.1% year-on-year to ₩5.1 trillion (US$3.76 billion) from the ₩4 trillion (US$2.7 billion) seen during the same period in 2021.
Net profit for the period reached ₩2.61 trillion won (US$1.91 billion), also up 13.3% from the ₩2.3 trillion won (US$1.7 billion) it reported during Q3 2021.
For the nine-month period, HMM's revenue totalled ₩15 trillion won (US$11.13 billion), up 61% from ₩9.3 trillion won (US$6.91 billion) in the same 2021 period.
Net profit in the January to September period also surged by 225% to ₩8.6 trillion (US$6.41 billion) from ₩2.6 trillion (US$1.97 billion) during the same nine-month period last year.
Downward pressure on cargo demand expected
"HMM has maintained a robust operating margin of 57.7% on a cumulative basis for nine months in 2022, resulting from favourable market conditions and sales capability despite rising costs," the shipping line said in its earnings statement.
"HMM will seek to maximize profitability by securing high-yield cargo and implementing cost-cutting measures by enhancing operational efficiency," the South Korean shipping line said.
Moving forward, HMM signalled a less bullish outlook for container demand on the back of persisting market volatilities that continue to impact supply chains.
"Container demand is expected to be under downward pressure due to considerable uncertainties mainly related to widespread inflation, economic slowdown and geopolitical tensions," HMM said, noting that the weakening purchasing power and major retailers' increased inventories also would negatively impact global container volumes.
