Container shipping lines see a sharp decline in revenue and profit in the first quarter of 2023
Container shipping lines recorded an average EBIT/TEU of $330/TEU in the first quarter of 2023, a sharp drop of 81% from $1,829/TEU in the first quarter of 2022.
According to Sea-Intelligence, there have been signs of weakness in the market in the second half of 2022, and this was evident in the first quarter of 2023.
Revenue fell sharply, ranging from 35% to 70% year-on-year, while profit before interest and tax (EBIT), had a sharp change in Q1 2023 compared to the previous two years. .
Overall, Q1 2023 EBIT came in at $7 billion compared to a whopping $43.93 billion in Q1 2022 and even lower than the US$16.28 billion EBIT of 2021-Q1. "That said, it is still markedly higher than the US$621 million EBIT of the first quarter of 2019," emphasized a representative of Sea-Intelligence.
In fact, the average EBIT of shipping lines has plummeted by 81% over the same period last year.
Source: Sea-Intelligence.com, Sunday Spotlight, issue 617
The drop in EBIT/TEU also shows this, as no carrier was able to maintain Q1 2022 EBIT/TEU for 2023. On average, the shipping lines recorded EBIT/TEU of US$330/TEU in 2023-Q1, down 81% from 2022-Q1’s average of US$1,829/TEU, but still vastly above the just US$53/TEU average of 2010-2021.
"The only silver lining, if you can even call it that, is that while Y/Y comparisons with 2022-Q1 will show a horrifying picture due to the unnaturally high numbers in that year, the reality is that the profitability of the shipping lines has increased considerably compared to the pre-pandemic levels, and looking at the current market indicators, it does not seem that the shipping lines are going to drop back down to those low levels in the short term," commented Alan Murphy, CEO of Sea-Intelligence.
Source: Phaata.com (According to Sea-Intelligence, ContainerNews)
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