Hanjin defers newbuildings as recession bites

Lloyd's List reports that Hanjin was seeking to defer deliveries of newbuildings on its 31-ship orderbook to mitigate the effects of global recessionary pressure.

“We have completed arrangements for five vessels and are continuing to negotiate deferred deliveries on other ships,” the company said.

It declined to identify specific vessels.

The company said the traditional first quarter slack also contributed to a 39.2% slump in sales to US$1.3bn, compared with slightly more than US$2bn in the first quarter of 2008.

Sales in the company’s container division fell to US$977m, down 37.5% year on year as container volumes dropped from 846,731 to 628,599.

Hanjin’s bulk division took the most severe mauling with sales falling 44.3% to US$289m resulting in a US$77m loss.

The company’s operating profit also plunged US$177m into the red with the container division notching up a US$142m operating loss.

A Hanjin spokesman said the company expected that weakening fundamentals caused by increasing supply and a slowdown in demand in the second quarter of 2009 would continue to negatively affect container
business.

The lowering freight rate effect would only be tempered by laid-up ships and service reshuffles.

However, the bulk sector is expected to experience a mild improvement in the second quarter as a result of growing demand from the start of the season in South America and lower raw material costs.