South Korea’s largest shipping company, HMM, reported an operating profit of nearly 1.4 trillion Korean won in the third quarter of this year. Compared to the same period last year, its operating profit surged nearly fivefold, with an operating profit margin of 34%, significantly outperforming major global shipping firms. This improvement is attributed to the company’s focus on high-margin cargo transportation and expansion of its bulk carrier business amid heightened uncertainty in the global shipping market due to the Middle East war and port congestion.
HMM disclosed on the 12th that its consolidated revenue for the third quarter of this year reached 4.1271 trillion Korean won, with an operating profit of 1.3947 trillion Korean won. Compared to the same period last year, revenue increased by 52%, while operating profit jumped 370%. The operating profit marks the highest level in two years since the third quarter of 2024 (1.4613 trillion Korean won). Compared to the previous quarter (354.1 billion Korean won), operating profit quadrupled. Net profit also rose 405% year-on-year to 1.5352 trillion Korean won.
Notably, profitability stood out. HMM’s third-quarter operating profit margin was 34%, meaning 34 Korean won of every 100 Korean won in revenue translated to operating profit. During the same period, global peers recorded margins of 20.6% for Maersk’s shipping division, 21.6% for Japan’s ONE, and 28.7% for China’s COSCO. HMM’s margin exceeded these competitors by more than 5 percentage points.
The container shipping business, HMM’s core segment, drove the performance improvement. From January to September, the container division’s cumulative operating profit reached 1.6353 trillion Korean won, a 55.3% increase from the same period last year. Despite global shipping uncertainties—including route instability from the Middle East war, port delays due to typhoons in China, and droughts at the Panama Canal—HMM efficiently managed its routes and prioritized securing high-rate cargo.
The bulk carrier business emerged as a new profit driver. From January to September, the bulk division’s cumulative operating profit surged to 378.4 billion Korean won, over five times the 73 billion Korean won recorded during the same period last year. The bulk segment’s share of total operating profit also rose from 6.4% last year to 18.8% this year. This growth followed structural changes since the second half of last year, including reducing short-term charters and expanding long-term contracts.
HMM is accelerating its bulk carrier expansion. The number of bulk carriers increased from 44 vessels at the end of the first quarter last year to 60 by the end of the third quarter this year. Including 22 vessels currently under construction, the total will reach 82. The company is also diversifying vessel types beyond dry bulk and oil tankers to include car carriers and gas carriers. This strategy aims to secure stable profits from the bulk segment even if container shipping rates decline.
From January to September, cumulative revenue increased 25% year-on-year to 10.2478 trillion Korean won, while operating profit rose 76% to 2.0179 trillion Korean won. HMM continues to expand its business, investing 6 trillion Korean won this year in fleet expansion and logistics infrastructure. Since CEO Choi Won-hyuk took office in March last year, cumulative investments have exceeded 12 trillion Korean won. The company plans to invest a total of 29 trillion Korean won to expand its fleet to 166 container vessels and 110 bulk carriers by 2030.
Source: The Chosun Daily