Newsupdate

MALAYSIAN NEWS UPDATE

Ethical financiers withdraw funds from beach scrappers ETHICAL investors are pressuring shipowners to stop providing employment to Indian, Bangladeshi and Pakistani slavors on dead ship beaches of the subcontinent because of poor working conditions. Norway's US$1 trillion Oil Fund, leading the pack of ethical investors, has punished four firms because they scrap on these beaches, by withdrawing investments. Among the defunded firms are Taiwan's Evergreen Marine, Korea Line, Precious Shipping and Thoresen Thai Agencies (TTA). But government officials and shipowners say conditions have improved significantly in recent years. Norwegian life insurer KLP soon followed, selling shares in the one of the four it owned and blacklisting the other three, Reuters reported. Further exclusions are likely, said KLP, the fund and its advisory Council on Ethics. The council's chief adviser, Aslak Skancke, said the divestments had already effected wider change, including encouraging companies to seek cleaner scrapping. Three leading pensions funds - Caisse de Depot, CCP and OMERS - are reviewing their investments in shipping over ethical and green considerations, a finance source familiar with the matter said. OMERS declined to comment. Caisse de Depot and CCP did not respond to requests for comment. More than 80 per cent of freighters are broken up on the beaches of Bangladesh, Pakistan and India. Industry leaders in South Asia say they cannot afford to upgrade their sites and remain competitive. Workers cut up ships with blowtorches, with parts and pollutants dropping directly onto the sand. Some sites have cranes, impermeable surfaces and safety standards for workers and equipment. "If there was to be a blanket ban on 'beaching' there would be a very, very serious capacity problem because there is nowhere else big enough to deal with it at the moment," said John Stawpert, manager for environment and trade at the International Chamber of Shipping, which represents most of the world's merchant fleet. Commerzbank has said it will exit shipping financing and invest its capital elsewhere; others, such as Deutsche Bank, say they aim to cut their exposure to the sector. Leading Dutch shipping finance houses ABN AMRO and ING, Sweden's Nordea, Norway's DNB and Denmark's Danske Bank, as well as the Netherlands' NIBC, say they are taking a hard look at their borrowers' policies.

MAERSK group, the world biggest shipping company, declared a 990.9 per cent year-on-year first quarter profit increase to US$2.76 billion, drawn on revenues of $9.3 billion, up 30 per cent. But the Danish shipping giant's revenue was up only 10 per cent, if the contribution of Hamburg Sud, which it purchased last year, went uncounted, reported American Shipper. First quarter gains were also driven by the sale of Maersk Oil to the French oil company Total in March, said Maersk group CEO Soren Skou, who also noted the company now owns 97.5 million shares of Total valued at $6.2 billion. Maersk's quarterly ocean revenue was up 38 per cent of $6.8 billion, the result of a 24 per cent increase in volume from the Hamburg Sud which lifted an additional to 3.2 million FEU. Without that, Maersk sea freight revenue would have been up nine per cent with volume rising 2.2 per cent. He also said he plans to return a material portion of the value of those shares to Maersk shareholders in the form of an extraordinary dividend, share buy-back or distribution of the Total shares to Maersk shareholders this year or in 2019. Quarterly pre-tax profit increased five per cent to $669 million. The higher EBITDA was "positively impacted by Hamburg Sud purchase with $88 million and strong performance in terminals and towage, but hit by a $100 million currency exchange loss. Maersk group profit increases nine fold, as Hamburg Sud buyout pays off Hamburg's HHLA reports 2.6pc first quarter box volume gain to 1.8 million TEU THE Port of Hamburg's biggest by far terminal operator, Hamburger Hafen und Logistik (HHLA) declared that first quarter container volumes increased 2.6 per cent year on year to 1.8 million TEU, reports London's Port Technology International. This development was driven by Asian traffic, which increased 8.9 per cent. A lower share of feeder traffic and higher storage fees meant that HHLA's revenue increased moderately by 4.9 per cent to US$226.8 million. Its segment operating result (EBIT) also rose by 2.6 per cent to $38.6 million, with its EBIT margin amounting to 17.1 per cent. HHLA's container transport declined by 5.3 per cent due to the realignment of Polzug's intermodal transportation activities, but has not affected HHLA's expectations for its Port Logistics subgroup EBIT, which has increased by 3.3 per cent. "Following a good start in the first quarter, we are confident that we will achieve our targets for the year," said HHLA chairwoman Angela Titzrath. "Furthermore, we have set up a structured process that will allow us to continually select and evaluate potential value-adding acquisition targets. One of the first results of this process is the acquisition of the largest terminal operator in Estonia, Transiidikeskuse AS in the port of Muuga," she said.