IS ANYONE MAKING A PROFIT IN SHIPPING?

MAERSK HAS BEEN ABLE TO MAKE A PROFIT IN 2016 BY REDUCING

COSTS AND AN INCREASE IN TEUS. BUT, HAS ANY OTHER SHIPPING LINE?

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@XENETA_AS

ABOUTXENETA

At Xeneta we believe there is an untapped potential for everyone in the industry, to systematically learn from our individual and collective efforts. We hold true that "if you cannot measure it, you cannot improve it". That’s why we think actionable metrics is the key to continuously evolve for every business, and ultimately the entire industry. Rethinking global logistics is the vision of Xeneta.

With international experience from the logistics industry, we have first-hand knowledge of the challenges related to high volatility and lack of transparency in the ocean freight market. By combining logistics background and information technology expertise, we found the solution to these challenges.

WE ARE TRANSFORMING GLOBAL LOGISTICS

ARE YOU PAYING THE RIGHT CONTAINER

FREIGHT RATES?

DISCOVER SAVINGS POTENTIAL IN REAL

TIME.

CONTACT US.

IN APRIL MAERSK LINE ANNOUNCED A Q1 2016 PROFIT, EARNING US $ 32 MILLION DUE TO A 7 % INCREASE IN VOLUME OF TEU’S CARRIED AND 16% IN COST REDUCTIONS.

(HUGE TURN-AROUND FROM THEIR Q4 2015 WHEN THEY LOST $ 165 MILLION.)

TEU VOLUME

COST

OUR UNEXPECTEDLY GOOD PERFORMANCE IS DUE TO MAERSK’S

90% CAPACITY UTILIZATION, OUR REDUCED-COSTS PROGRAM, AS

WELL AS LOWER BUNKER COSTS.

- MAERSK’S CHIEF EXECUTIVE NILS ANDERSEN

BUT BUNKERS ARE RISING ALONG WITH CRUDE OIL PRICES, AND HOW MANY OTHER LINES ARE ABLE TO AVERAGE 90% UTILIZATION?

THIS RAISES THE QUESTION: CAN ONE MAKE A PROFIT IN THE SHIPPING INDUSTRY?

YES. IF YOU ARE A FREIGHT

FORWARDER / CONSOLIDATOR.

THE ANSWER IS:

ARE YOU PAYING THE RIGHT CONTAINER

FREIGHT RATES?

DISCOVER SAVINGS POTENTIAL IN REAL

TIME.

FREIGHT FORWARDER

EXPEDITORS DOWN 3% DOWN 19%

UP 16%

FLAT

FLAT

UP 8%

DOWN 8%

DOWN 10%

CH ROBINSON

KUEHNE + NAGEL

PANALPINA

SEA FREIGHT $ VOLUME

PROFIT

THE BIGGER FREIGHT FORWARDERS RELEASED THEIR Q1 2016 FINANCIAL RESULTS (AS COMPARED TO Q4 2015), WITH RESULTS

FAR DIFFERENT FROM THE CARRIERS:

OUR UNEXPECTEDLY GOOD PERFORMANCE IS DUE TO MAERSK’S

90% CAPACITY UTILIZATION, OUR REDUCED-COSTS PROGRAM, AS

WELL AS LOWER BUNKER COSTS.

- MAERSK’S CHIEF EXECUTIVE NILS ANDERSEN

MANY OF OUR CUSTOMERS ARE BEING CAUTIOUS ABOUT HOW TO SPEND THEIR LOGISTICS DOLLAR, TAKING ADVANTAGE OF ABUNDANT CAPACITY IN

SEARCH OF LOWER RATES WHERE POSSIBLE, AND WE ARE ALIGNING OURSELVES TO ADDRESS THEIR

NEEDS… WE CONTINUED TO BENEFIT FROM AVAILABLE OCEAN AND AIR CARRIER CAPACITY AND

FAVORABLE MARKET BUYING OPPORTUNITIES.

- EXPEDITORS CFO BRADLEY POWELL

SMALLER SHIPPERSAIDING THE PROFIT

LESS AWARE OF WHAT HAPPENS IN THE MARKET IN TERMS OF PRICING.

HOLD HIGHER PRICES LONGER TOWARDS THESE SMALLER SHIPPERS.

KNOWN TO RAISE PRICES TOWARDS THEM AT A FASTER PACE.

LESS AWARE OF WHAT HAPPENS IN THE MARKET IN TERMS OF PRICING.

HOLD HIGHER PRICES LONGER TOWARDS THESE SMALLER SHIPPERS.

KNOWN TO RAISE PRICES TOWARDS THEM AT A FASTER PACE.

ALLOW FREIGHT FORWARDERS TO REAP FROM THE DECLINING MARKET WE'VE SEEN.

INCREASES THEIR MARGINS (EVEN THOUGH REVENUES GO DOWN).

MANY OF OUR CUSTOMERS ARE BEING CAUTIOUS ABOUT HOW TO SPEND THEIR LOGISTICS DOLLAR, TAKING ADVANTAGE OF ABUNDANT CAPACITY IN

SEARCH OF LOWER RATES WHERE POSSIBLE, AND WE ARE ALIGNING OURSELVES TO ADDRESS THEIR

NEEDS… WE CONTINUED TO BENEFIT FROM AVAILABLE OCEAN AND AIR CARRIER CAPACITY AND

FAVORABLE MARKET BUYING OPPORTUNITIES.

- EXPEDITORS CFO BRADLEY POWELL

FREIGHT AS A COMMODITY CAN BE

THE ANSWER

PROFITS CAN BE EARNED IN SHIPPING,BUT A FORWARDER NEEDS TO TREAT CONTAINER FREIGHTS AS A COMMODITY TO BE BOUGHT AND SOLD, INSTEAD OF SOMETHING TO BE BOOKED.

“CONTRACT RATES WILL BE LOWER AND WE WILL THEREFORE BE MORE EXPOSED TO THE SPOT MARKET”- MAERSK’S CHIEF EXECUTIVE NILS ANDERSEN

LESS AWARE OF WHAT HAPPENS IN THE MARKET IN TERMS OF PRICING.

WITH BUNKERS RISING, THE OLD HIGHER PRICE CONTRACTS EXPIRING, AND THE XENETA PLATFORM CONTINUING TO REPORT LOW RATES, BOTH THE CARRIERS AND FORWARDERS MAY WISH THEY HAD A TERMINAL MARKET IN CONTAINER FREIGHTS 18 MONTHS AGO ON WHICH THEY’D HEDGED THEIR FREIGHT.

LEARN HOW XENETA CAN HELPYOU GET INSIGHT AND

INTELLIGENCE INTO YOUR GLOBAL OCEAN FREIGHT PRICES AND CHANGE YOUR LOGISTICS

BUSINESS:

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