Singapore shipping line PIL quadruples profits for 2024, but warns 2025 will be challenging
PIL chief executive Lars Kastrup noted that the liner's operational strength, strong cash position and efficient cost-cutting enabled it to perform well. PHOTO: PACIFIC INTERNATIONAL LINES (PIL)
Singapore shipping line PIL quadruples profits for 2024, but warns 2025 will be challenging
SINGAPORE - Pacific International Lines (PIL) has more than quadrupled its earnings for 2024, thanks to a surge in demand for container shipping and higher freight rates, but warned that 2025 will be a tougher year with more disruptions.
The Singapore shipping line on May 16 announced 2024 earnings amounting to US$1.34 billion (S$1.73 billion), which is up by more than 330 per cent compared with 2023.
Revenue surged 49 per cent year on year to US$4.31 billion, largely driven by growth in its container shipping segment, which enjoyed higher freight rates and a 9.6 per cent increase in the number of containers moved on its ships.
Container shipping accounted for more than 87 per cent of the liner's revenue in 2024. The liner's key routes are Africa, South America and the Middle East and intra-Asia.
PIL's container manufacturing business also grew, boosted by increased demand for containers amid Red Sea shipping disruptions and pre-election restocking activity in the US.
The home-grown liner has been expanding its revenues and investing in its fleet of vessels since receiving a US$600 million lifeline from Temasek's wholly owned Heliconia Capital Management in 2021 to help it stave off bankruptcy. The bailout involved Heliconia taking a majority stake in the liner.
As at end-2024, PIL reported healthy cash reserves of US$2.33 billion and a fleet of 101 ships able to transport a total of 442,000 twenty-foot containers. The fleet comprises 89 owned and 12 chartered ships.
In 2024, the liner rolled out a US$2 billion plan to replace part of its fleet with dual-fuel container ships that can run on both liquefied natural gas and conventional marine fuel as pressure widens for shipping to comply with the industry's net-zero targets.
It has received six newbuilds since October 2024, including two that have the capacity to move 14,000 containers, and has another 12 newbuild vessels on order.
PIL chief executive Lars Kastrup noted that the liner's operational strength, strong cash position and efficient cost-cutting enabled it to perform well despite a challenging environment for shipping.
In 2024, the industry faced major disruptions caused by disruptions in the Red Sea. These include congestion in key ports due to scrambled shipping schedules and more vessels being deployed to longer routes to ensure goods are delivered on time.
More shippers also accelerated shipments in anticipation of potential disruptions, including dockworker strikes at major US ports and new tariffs on US-bound goods. This surge in early deliveries contributed to supply chain bottlenecks and tightened shipping capacity.
These challenges are expected to intensify in 2025, at a time when many terminals are not able to develop fast enough to keep up with the volume growth and larger-sized container vessels that are being introduced into existing and emerging markets, Mr Kastrup said.
'The year ahead is expected to be filled with uncertainty and heightened challenges. The additional capacity brought on by newbuild vessels coming on stream in 2025 is expected to outpace the market demand for goods, although continued port congestions may absorb some of the capacity growth,' he said.
He added that the liner's strong cash position will enable it to continue to seek business growth.
Join ST's Telegram channel and get the latest breaking news delivered to you.

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Times
33 minutes ago
- Business Times
Oil demand growth to continue, no peak in sight, Opec Secretary General says
[CALGARY] Oil demand growth will remain robust over the next two and a half decades as the world population grows, Opec Secretary General Haitham Al Ghais said on Tuesday. The organization expects a 24 per cent increase in the world's energy needs between now and 2050, with oil demand surpassing 120 million barrels per day over that time period. That estimate is in line with the group's 2024 World Oil Outlook. 'There is no peak in oil demand on the horizon,' Al Ghais said, speaking at the Global Energy Show in Calgary, Alberta. He said Opec admired what Canada's oil industry has done to increase its oil output in recent years. Canada achieved record oil production in 2024, as the completion of the Trans Mountain pipeline expansion boosted the ability of oil companies to get their product to market. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Danielle Smith, premier of Canada's main oil-producing province of Alberta, has spoken of her desire to double the province's oil and gas output by 2050. Al Ghais said Opec has been consistent in warning of the dangers of inadequate global investment in oil and gas, given its forecast for demand growth. He said failing to invest enough capital to meet projected demand growth risks undermining energy security and causing volatility for both producers and consumers, and added Opec believes there is a need for US$17.4 trillion in capital investment in the global energy sector over the next 25 years. Opec+ is unwinding its output cuts at a faster pace than originally anticipated, lifting production by 411,000 barrels per day for May, June and July. The increases, along with concerns that US President Donald Trump's trade war will weaken the global economy, have pressured oil prices in recent months. Global Brent futures settled at US$66.87 a barrel on Tuesday. The US Energy Information Administration (EIA) on Tuesday said it expected Brent oil prices to fall near US$60 a barrel by the end of the year and average US$59 a barrel next year, hitting US oil production. Al Ghais on Tuesday also said Opec welcomed recent pushback against what he referred to as unrealistic climate goals that are overly focused on meeting specific deadlines. He said there is a need for countries to reduce emissions but stressed that should not mean picking and choosing between energy sources. He said instead governments and companies should be looking for ways to reduce emissions from oil and gas through technologies such as carbon capture and storage. REUTERS
Business Times
33 minutes ago
- Business Times
Blackstone plans US$500 billion Europe investment: CEO
BLACKSTONE is planning to invest as much as US$500 billion in Europe over the next 10 years, underlining the continent's growing appeal to investors during a period of geopolitical flux. 'We see it as a major opportunity for us,' chief executive officer Steve Schwarzman said in a Bloomberg Television interview on Tuesday. 'They are starting to change their approach here, which we think will result in higher growth rates. So this has worked out amazingly well for us.' Schwarzman's comments, which mark the 25th anniversary of the alternative asset manager's operations in London, are the latest sign of investment firms touting the attractiveness of Europe. At last week's SuperReturn International conference in Berlin, executives from behemoths such as BC Partners, Permira and Brookfield Asset Management talked up the case for Europe as an investment destination as global economic risks mount. When Blackstone opened its London office in 2000, the firm's only other office was in New York, according to a statement at the time. Then, it had raised more than US$13 billion for discretionary investment funds focused on alternative asset classes. Today, it is the world's largest alternative asset manager, with more than US$1 trillion in assets under management and offices in 27 cities around the world, according to its website. It is the largest fund manager in European real estate, according to industry group INREV. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up A bet on the continent's urban warehouses is one of Blackstone's largest and most profitable investments ever. The firm's London office, which is due to move to a new building that's currently under construction on Berkeley Square in Mayfair, now employs 650 people, Schwarzman said. The firm has about US$100 billion invested in the UK already, making it one of the largest foreign investors in the country, he added. Blackstone has poured capital into UK real estate bets, including a site for a data center in the north of England that has the potential to be Europe's largest. 'The UK government has been really helpful, really focused to make that happen,' Schwarzman said. Outside Europe, Blackstone is also looking to the Middle East as an investment destination, rather than simply a region in which it has raised vast sums of capital. While the region has traditionally been dominated by local businesses and capital, the rapid growth of cities including Riyadh and Dubai as international hubs is making it an attractive opportunity, he said. BLOOMBERG
Business Times
an hour ago
- Business Times
Europe: Stocks flat as investors await outcome of US-China talks
EUROPEAN shares closed little changed on Tuesday in cautious trade as investors awaited the outcome of the second day of US-China trade talks in London. The continent-wide Stoxx 600 index closed unchanged for the second straight day at 553.12 points. The two-day London meeting between the world's two economic powerhouses was still ongoing, a US Treasury spokesperson said, while a separate US official had said the two sides had ended direct talks. While President Donald Trump's upbeat comments on Monday about the talks had offered some hope the two countries would defuse their bitter trade dispute, the silence about any progress kept a lid on any breakout in stock markets. Any positive breakthrough in the negotiations is likely to provide relief to markets given that Trump's erratic tariff policies and the volatility of Sino-US relations have already scarred both economies, dented supply chains, and cast a shadow over global growth projections. 'There's a lack of clarity on what an actual deal could be,' said Laura Cooper, head of macro credit and investment strategist at Nuveen. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'Until we see a substantial trade deal emerge, attention will be on the end of that 90-day pause and its implications if there isn't a deal in place.' The two countries are trying to revive a temporary truce reached in Geneva that had briefly lowered trade tensions and calmed markets. In European stocks, the financials index, shed 1.4 per cent, led by a near 5 per cent drop in UBS on investor concern that Swiss government proposals could shackle the bank with an additional US$26 billion capital mandate. Defence stocks also retreated to an over one-week low. Conversely, energy stocks were the stand-out performer, boosted by higher oil prices. The healthcare sector advanced 1.2 per cent, led by Novo Nordisk, which gained about 6 per cent following a Financial Times report that activist hedge fund Parvus Asset Management was building a stake in the drugmaker. Vaccine makers such as AstraZeneca and Sanofi also climbed, despite the US health secretary dismantling the US Centres for Disease Control and Prevention's vaccine advisory committee. London's FTSE 100 flirted with a record high earlier in the session after fresh data revealed a sharp deceleration in British pay growth through April, coupled with unemployment hitting a four-year peak - strengthening the case for an interest rate cut by the Bank of England. Attention is also on a slew of key economic indicators from the region as well as the US, due through the week. 'With US CPI data due on Wednesday, the mood could remain cautious,' said Fiona Cincotta, senior market analyst at City Index. Among other stocks, Bellway jumped 7.8 per cent after the British homebuilder raised its forecast for full-year volume production. Shares of Aberdeen gained 6.3 per cent after JPMorgan upgraded the fund manager's stock to 'overweight' from 'neutral'. REUTERS