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Evergreen Marine forecasts return to profit

Published:Tuesday | March 23, 2010 | 12:00 AM

TAIWAN'S largest container line, Evergreen Marine, and rated third in the United States (US) top 100 carriers for 2009, expects its business to return to the black in 2010 following net losses of T$2.6 billion ($81.6m) in the third quarter of last year.

However, analysts are cautious that climbing fuel prices could cast uncertainty over the recovery of the container line.

Evergreen Marine spokesman Nieh Kuo-wei said the company expected a turnaround this year, adding that the surging demand to replenish depleted inventory had led to several rounds of successful rate increases, and substantially improved the profit outlook of the container shipping industry, Reuters reported.

Evergreen Marine chairman Bronson Hsieh previously said the company would post a small loss in the first quarter, and expected its business would break even in the second quarter in anticipation of the rise of freight rates on its main route such as Asia-US.

Pessimistic outlook

However, Fubon Securities shipping analyst Daniel Tzeng remained pessimistic on the company's outlook, saying it would post a loss of T$0.2 per share, as a whole this year.

Tzeng said the company made the profit forecast based on the assumption that international crude prices hovered below $80 per barrel throughout the year. Evergreen Marine's forecasts for freight rate rise and fuel price trends were too optimistic, he said.

Evergreen Marine will raise the freight rate for its shipping services from the Far East, Indian subcontinent to Europe by $400 per twenty-foot equivalent unit from April 1. The container line will release its annual result for 2009 at the end of the month.

Evergreen Line has been represented in Jamaica by Lannaman & Morris Shipping for the past 30 years, Vance Lannaman and Ainsley Morris incorporated Lannaman & Morris (Shipping) Limited in March 1973, both of whom, by that time, had many years' experience in the shipping industry. Harriat P. Maragh is currently the chief executive officer of Lannaman & Morris. From its inception the company became an important force in the shipping industry and in a short time built an enviable reputation as an efficient shipping company. Lannaman & Morris (Shipping) Limited acts as liner, chartering and husbanding agents in addition, representing freight forwarders and cargo consolidators.