Evergreen Marine Corp., Taiwan's biggest shipping line by market value, posted a 71 percent drop in first-quarter profit because increased global capacity made rates decline.
Net income fell to NT$349.6 million, or 11 NT cents a share, from NT$1.22 billion, or 40 NT cents, a year earlier, the Taipei-based company said in a filing to the Taiwan Stock Exchange yesterday. That was better than the median estimate of a NT$290 million loss in a Bloomberg survey of three analysts. Sales fell 17 percent to NT$7.21 billion.
A 14 percent surge in the global shipping fleet's capacity last year has forced Evergreen Marine and its global competitors including A.P. Moeller-Maersk A/S to cut rates in the past year.
"The number of new ships in the market is huge," Charles Ma, a Taipei-based analyst at SinoPac Securities Corp. and who as a "hold" recommendation on the stock, said before the earnings announcement. "Market conditions haven't been as good as anticipated."
Evergreen Group, of which Evergreen Marine is a member, has 150 vessels, which can carry a combined 560,000 standard 20-foot containers.
Shares of Evergreen Marine fell 2.6 percent to close at NT$20.45 in Taipei at 1:30 p.m. before the earnings announcement. The stock has advanced 8.5 percent this year, compared with a 0.7 percent gain in the benchmark Taiex index.
First-quarter operating costs fell 19 percent from a year earlier to NT$5.72 billion, Evergreen Marine said. The average price of 380 Centistoke bunker fuel for ships fell 7.7 percent during the quarter, according to data compiled by Bloomberg.
For 2006, Evergreen Marine's net income fell 97 percent to NT$411.6 million, or 13 NT cents a share, from NT$12.2 billion, or NT$3.96, a year earlier, the company said in a separate filing to the Taiwan Stock Exchange today.
Singapore-based Neptune Orient Lines Ltd., operator of Asia's fourth-largest container line, said April 2 that average revenue per cargo box fell 6 percent in the 10 weeks to March 9.
Maersk, the world's largest shipping company, said March 28 that net income fell 23 percent in 2006 as freight rates were on average 10 percent lower, excluding an extra fee the Copenhagen- based company took for higher fuel costs.
Global shipping capacity increased 14 percent in 2006, the fastest pace in six years, according to London-based industry magazine Containerisation International.
Net income fell to NT$349.6 million, or 11 NT cents a share, from NT$1.22 billion, or 40 NT cents, a year earlier, the Taipei-based company said in a filing to the Taiwan Stock Exchange yesterday. That was better than the median estimate of a NT$290 million loss in a Bloomberg survey of three analysts. Sales fell 17 percent to NT$7.21 billion.
A 14 percent surge in the global shipping fleet's capacity last year has forced Evergreen Marine and its global competitors including A.P. Moeller-Maersk A/S to cut rates in the past year.
"The number of new ships in the market is huge," Charles Ma, a Taipei-based analyst at SinoPac Securities Corp. and who as a "hold" recommendation on the stock, said before the earnings announcement. "Market conditions haven't been as good as anticipated."
Evergreen Group, of which Evergreen Marine is a member, has 150 vessels, which can carry a combined 560,000 standard 20-foot containers.
Shares of Evergreen Marine fell 2.6 percent to close at NT$20.45 in Taipei at 1:30 p.m. before the earnings announcement. The stock has advanced 8.5 percent this year, compared with a 0.7 percent gain in the benchmark Taiex index.
First-quarter operating costs fell 19 percent from a year earlier to NT$5.72 billion, Evergreen Marine said. The average price of 380 Centistoke bunker fuel for ships fell 7.7 percent during the quarter, according to data compiled by Bloomberg.
For 2006, Evergreen Marine's net income fell 97 percent to NT$411.6 million, or 13 NT cents a share, from NT$12.2 billion, or NT$3.96, a year earlier, the company said in a separate filing to the Taiwan Stock Exchange today.
Singapore-based Neptune Orient Lines Ltd., operator of Asia's fourth-largest container line, said April 2 that average revenue per cargo box fell 6 percent in the 10 weeks to March 9.
Maersk, the world's largest shipping company, said March 28 that net income fell 23 percent in 2006 as freight rates were on average 10 percent lower, excluding an extra fee the Copenhagen- based company took for higher fuel costs.
Global shipping capacity increased 14 percent in 2006, the fastest pace in six years, according to London-based industry magazine Containerisation International.