Hapag-Lloyd has reported a sharp deterioration in first-quarter earnings, attributing the decline to severe weather disruptions and the ongoing conflict in the Middle East. The German container shipping giant posted Group EBITDA of $494 million (€422 million) for the first quarter of 2026, down sharply from €1.05 billion a year earlier. Group EBIT swung to a loss of €134 million from a €463 million profit in the same quarter last year, while net profit fell to a loss of €219 million.
CEO Rolf Habben Jansen said the first quarter was unsatisfactory, with weather-related supply chain disruptions and pressure on freight rates leading to significantly lower results. The company's liner shipping segment generated revenues of €4.1 billion, down nearly 18% year-over-year, as average freight rates fell 9.5% to $1,330 per TEU. Transport volumes slipped 0.7% to 3.2 million TEU.
The Strait of Hormuz experienced what Hapag-Lloyd described as a de facto closure at the end of February, triggering reroutings, delays, and longer transit times that increased transportation costs across the company's network. The conflict in the Middle East has pushed up transportation costs globally. Severe weather events in Europe and North America disrupted terminal operations and broader supply chains, compounding congestion pressures already affecting global shipping networks. Brent crude prices nearly doubled during the quarter, ending March at $118.35 per barrel, while low-sulfur bunker fuel prices surged more than 80% from year-end 2025 levels.
Despite the weak quarter, Hapag-Lloyd has maintained its full-year guidance, forecasting Group EBITDA between $1.1 billion and $3.1 billion and EBIT between a loss of $1.5 billion and a profit of $500 million. The company cautioned, however, that the outlook remains subject to considerable uncertainty because of freight rate volatility and the evolving Middle East conflict. Hapag-Lloyd also continued advancing its planned $4.2 billion acquisition of ZIM Integrated Shipping Services, which would strengthen its position as the world's fifth-largest liner shipping company pending regulatory approvals.
The company said its Gemini Cooperation network with Maersk has helped maintain schedule reliability despite operational disruptions. Hapag-Lloyd management noted that higher fuel prices tied to the regional conflict are increasing transportation costs globally, though it expects part of that impact to be offset by higher freight rates. The industry anticipates continued volatility in freight rates and geopolitical risks throughout the remainder of 2026.
Key Takeaways:
1. Hapag-Lloyd reported a net loss of €219 million in Q1 2026 as EBITDA fell to $494 million.
2. De facto closure of the Strait of Hormuz and Middle East conflict triggered reroutings and rising costs.
3. Average freight rates declined 9.5% to $1,330 per TEU amid market pressure.
4. Brent crude prices nearly doubled during the quarter, reaching $118.35 per barrel in March.
5. The company maintained full-year EBITDA guidance of $1.1-3.1 billion but emphasized considerable uncertainty.
