Sea-Intelligence, a leading provider of research and analysis, has presented data that indicated weakness in the market in the second half of 2022, which manifested fully in Q1 2023.
Revenues have declined quite sharply, in the range of 35 per cent – 70 per cent year-on-year (YoY).
In terms of EBIT, there was a stark difference for Q1 2023 versus the previous two years.
Overall, Q1 2023 EBIT was $7 billion versus a staggering $43.93 billion in Q1 2022, and even lower than the $16.28 billion EBIT of Q1 2021.
However, it is still markedly higher than the $621 million EBIT of Q1 2019.
In fact, the combined EBIT drop YoY was a staggering -81 per cent (across the same set of carriers), reported Sea-Intelligence.
This can also be seen in the EBIT/TEU figures, where none of the shipping lines were able to sustain their Q1 2022 EBIT/TEU figures into 2023.
On average, the shipping lines recorded EBIT/TEU of 330 USD/TEU in Q1 2023, down 81 per cent from Q1 2022’s average of 1,829 USD/TEU, but still vastly above the just 53 USD/TEU average of 2010-2021.
“The only silver lining, if you can even call it that, is that while Y/Y comparisons with Q1 2022 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,” said Alan Murphy, CEO, Sea-Intelligence.
When reviewing current market indicators, it seems unlikely that shipping lines are going to decrease to those low levels in the short term, concluded Sea-Intelligence.
In April 2023, Sea-Intelligence reported that the shipping industry recorded a combined EBIT of $138 billion in the 2022 fiscal year – excluding CMA CGM, PIL, and MSC, which did not publish their EBIT reports.