Despite freight rate improvements that followed the bankruptcy of Hanjin last summer, only three carriers declared an annual profit while the rest posted losses.
Hyundai Merchant Marine (HMM) recorded the worst operating results among the main carriers in 2016, with its container business posting an annual operating loss of KRW692 billion (US$595 million).
HMM was forced to undergo restructuring exercise involving a debt-equity swap of KRW1.1 trillion, extension of the bond maturities of KRW800 billion and charter rate adjustments of KRW43 billion.
Taiwan carrier Yang Ming also had to rely on state support after posting operating losses of TWD15.1 billion (US$470 million). The Taiwan government's National Development Fund (NDF) took a 6.4 per centstake in Yang Ming under a recapitalisation programme in February 2017 that raised TWD1.69 billion from six investors headed by the NDF. The NDF is expected to continue to support Yang Ming's subsequent capital raising programmes.