Hong Kong-headquartered OOCL has seen both revenue and volumes for the first quarter of this year scale an upwards trajectory compared to the same period in 2010. However, its Asia-Europe trade has become the weak link in its portfolio.

Q1 volumes jumped by 12.6% to 1.18 million TEU, while revenue shot up by 17.2% to reach USD1.3 million. The unaudited update from OOCL's parent company Orient Overseas International Limited (OOIL) said that overall average revenue per TEU increased by 4.2% year-on-year. It added that while there was a 16.8% boost in its loadable capacity, the overall load factor represented a decline of 2.9% compared to Q1 last year.

Drilling down into the tradelanes, Intra-Asia/Australasia market registered the fastest rate of growth, with volumes up 17.1%to 597,233TEU and revenue surging by 22.5% to USD421 million. The transpacific trade was the largest and most profitable for the carrier, with its liftings of 296,433TEU registering a swell of 9.7% compared to the same period last year. Revenue climbed 23.3% to reach USD473 million. The carrier's Asia-Europe trade jumped 8.3% to 196,174TEU - but revenue only grew by a tiny 0.2% to USD277 million.

A reason for the more lacklustre performance by OOCL on the Asia-Europe tradelanes could be that operating margins, especially in this market, have 'crashed' in this first quarter, according to Alphaliner. The consultancy said: 'operating margins have crashed in the first quarter of 201 - especially on the Asia-Europe trade. A lack of discipline in regard to capacity management has prompted freight rates to decline across all main trades since the third quarter of last year, as all main carriers increased capacity in order to defend or even expand their market share.'

And the consultancy has a gloomy forecast for carriers' Q1 profits, as it said: 'a majority of shipping lines are expected to post negative operating results in the January to March period. Operating losses are expected to persist for much of the first half of this year. Falling freight rates and increased cost pressure from rising fuel and vessel charter rates have dented operating margins, while carriers are not expected to be post rate increases until late May at the earliest.'