OOCL sees strong 2024 earnings despite shipping industry challenges

OOCL container ship. Photo: OOCL / Phaata

Orient Overseas (International) Ltd. (OOIL) has just announced solid financial results in 2024, thanks to the OOCL container shipping business, with shareholder profits reaching $2.58 billion, up sharply from $1.37 billion in 2023.

The Hong Kong-based company, owned by China's Cosco Shipping, recorded revenue rising to $10.7 billion in 2024, compared to $8.34 billion in 2023. Operating profit reached $2.62 billion, up from $1.41 billion, while earnings per share (EPS) increased to $3.90 from $2.07.

OOIL Group (0316.HK) will propose a dividend of $1.32 per share at its annual general meeting in May.

OOCL's container shipping and logistics business was the main driver behind the impressive results, with pre-tax profit reaching $2.64 billion. The company said it benefited from the recovery in global trade, despite complex market conditions.

In 2024, OOCL took delivery of seven new large container ships and chartered six 13,000-TEU vessels for future deployment. It also strengthened cooperation with its Ocean Alliance partners, including Cosco (China), CMA CGM (France) and Evergreen Marine (Taiwan, China) - one of the largest cooperation agreements in the shipping industry.

“While the outlook remains uncertain, we are well-prepared to embrace opportunities and respond to challenges,” said OOIL Chairman Wan Min, in a release. “We will consistently fulfill our commitment to customers and offer high-quality, reliable services.”

However, the company also warned of potential challenges such as geopolitical tensions, economic volatility and overcapacity in the industry. Major shipping lines have yet to return to the Red Sea-Suez Canal route, due to attacks by Houthi forces in Yemen in 2024. The diversion of vessels from Asia to Europe, the Mediterranean and the United States via the Cape of Good Hope (South Africa) route has reduced some market capacity, causing congestion in the region and pushing up freight rates. However, the possibility of reopening the Red Sea route, along with the introduction of new vessels, is putting pressure on carriers to increase freight rates.

Despite the challenges, OOIL still expressed confidence in its dual-brand strategy with Cosco, its optimal operating performance and its ability to adapt to market conditions.

The company will hold its annual general meeting on May 15. If approved, the dividend will be paid on June 27 to shareholders of record by May 28.

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Source: Phaata.com (According to Freight Waves)

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