HMM Posts KRW 1.3947 Trillion Operating Profit in Q3, Up 370% YoY

Operating margin reaches 34%
Cumulative operating profit of KRW 2.0179 trillion in the first three quarters
Bulk segment's share of operating profit expands to 18.8%

HMM significantly boosted its profitability in the third quarter of this year, posting an operating profit of KRW 1.3947 trillion. Its operating margin reached 34%, exceeding the levels in the 20% range recorded by major global shipping companies. The improvement was driven by diversifying its earnings structure: HMM maintained the competitiveness of its container business while expanding its bulk business.

HMM said on Thursday that it recorded consolidated revenue of KRW 4.1271 trillion, operating profit of KRW 1.3947 trillion, and net profit of KRW 1.5352 trillion in the third quarter. Revenue rose 52% year on year, while operating profit and net profit increased 370% and 405%, respectively. Operating profit was the highest since the KRW 1.4613 trillion recorded in the third quarter of 2024.

Compared with the previous quarter, revenue rose 21%, operating profit increased 294%, and net profit climbed 273%. Cumulative revenue for the first three quarters thus totaled KRW 10.2478 trillion, while operating profit came to KRW 2.0179 trillion, up 25% and 76%, respectively, from the same period a year earlier. Cumulative net profit increased 52% to KRW 2.3002 trillion.

In particular, HMM's third-quarter operating margin reached 34%, higher than those of major global shipping companies. It surpassed the margins reported for the quarter by Maersk's ocean business (20.6%), Ocean Network Express (ONE) (21.6%), and COSCO (28.7%).

Both the container and bulk segments posted growth. Cumulative operating profit in the container segment for the first three quarters rose 55.3% to KRW 1.6353 trillion from KRW 1.0533 trillion a year earlier.

HMM said it expanded its global network based on its Hub & Spoke strategy and focused on securing high-margin cargo. It added that it improved profitability by strategically managing its fleet and routes despite ongoing external uncertainties, including port congestion caused by the war in the Middle East and typhoons in China, as well as drought in the Panama Canal.

Growth in the bulk segment was also notable. Cumulative operating profit for the first three quarters increased 418.5% to KRW 378.4 billion from KRW 73 billion a year earlier. The bulk segment's share of total operating profit also expanded from 6.4% last year to 18.8% this year.

This is seen as the result of a business restructuring initiative launched in the second half of last year. HMM reshaped its portfolio to move away from a business model centered on short-term vessel charters and expand long-term, high-quality contracts. As a result, operating profit in the bulk segment rose from KRW 45 billion in the third quarter of last year to KRW 70 billion in the fourth quarter and KRW 83 billion in the first quarter of this year, before reaching KRW 156.3 billion in the second quarter and KRW 139 billion in the third quarter.

HMM is also continuing to expand its fleet. At the end of the third quarter, its bulk fleet totaled 60 vessels, up 36% from 44 at the end of the first quarter of last year. Including 22 vessels awaiting delivery after being ordered, the fleet will total 82. Ahead of rising vessel prices, HMM has secured competitively priced vessels through various means, including newbuilding orders, purchases of secondhand vessels, and resales.

HMM is also working to diversify its vessel types. In addition to its existing dry bulk carriers and oil tankers, it plans to expand into car carriers (PCTCs), gas carriers, and multipurpose vessels to reduce the impact of container market fluctuations on its earnings and establish a stable earnings base.

HMM plans to invest a total of KRW 6 trillion this year in fleet expansion, logistics infrastructure, and securing future technologies. Since CEO Choi Wonhyuk took office in March 2025, cumulative investment has exceeded KRW 12 trillion.

Over the medium to long term, HMM plans to invest a total of KRW 29 trillion, including building a fleet of 166 container ships with a capacity of 1.47 million TEU and 110 bulk carriers with a capacity of 13.52 million DWT by 2030. The company aims to strengthen its competitiveness against global shipping companies by diversifying its business portfolio and enhancing its fleet competitiveness.

This content was produced with the assistance of AI translation services.