Hapag-Lloyd says the party's over for shippers

STORY: The party appears to be over for container shipping firms.

On Thursday (March 2) the German firm reported record profits of just over $18 billion for last year.

That was 88% up on a year before.

It benefited from exceptional freight rates, especially during the spring.

That allowed it to invest in its fleet and make acquisitions.

But now the company says tougher times lie ahead.

Like bigger rival Maersk, it says costs are rising and demand is cooling off.

It expects that pre-tax earnings won’t go much higher than $4 billion this year.

The company also warned that the guidance is subject to a lot of uncertainty due to the conflict in Ukraine and the effect of inflation.

However, it says the end of health-crisis restrictions is a positive.

That’s helping to unclog ports and logistics operations.

Hapag-Lloyd shares were trading broadly flat by lunchtime in Europe.