GERMAN shipping giant Hapag-Lloyd suffered a net loss of EUR93.1 million (US$100.5 million) in 2016, drawn from revenues of EUR7.7 billion, which fell 12 per cent.
Hapag-Lloyd, the world's fifth biggest container shipping line, also posted a pre-tax (EBITDA) profit of EUR607.4 million in 2016, down 26.9 per cent year on year.
"We had a very challenging market environment in the first six months of 2016, but were able to improve revenue and results significantly in the second half," said CEO Rolf Habben Jansen.
"Even though we performed relatively well in the industry in 2016, the bottom line is still that this result is not satisfactory," he said.
"We expect some market improvement in 2017, but our success will largely depend on our ability to achieve more sustainable freight rates. Longer term, the lack of orders for new builds and the continued high scrapping figures point to a better equilibrium between capacity supply and demand," said Mr Habben Jansen.
Container volume increased 2.7 per cent year on year to 7.6 million TEU, but with freight rates averaging $1,036 per TEU, yield was 15.4 per cent lower year on year.
At the same time, transport costs fell 12.3 per cent to EUR6.3 billion because of 6.3 per cent lower bunker prices, but not enough to offset the decline in the average freight rate, said the company.