FRANKFURT (Reuters) – German container company Hapag-Lloyd on Wednesday reported a 75% lower net profit in the first half of 2024 but focused on a higher full-year profit outlook after raising key figures in July, citing market strength.

“Even though we were unable to match the exceptionally good results of the previous year, we delivered a very good first half of 2024 thanks to strong demand and better spot prices,” said CEO Rolf Habben Jansen.

“In the second half of the year, we will focus more on further growth and the high quality of our services,” he added.

Group net profit for the first six months was 732 million euros ($804.47 million), down from 2.9 billion euros a year earlier, said Hapag-Lloyd, the world’s fifth-largest container shipping company.

The company reported earnings before interest, taxes, depreciation and amortization (EBITDA) down 48 percent to EUR 1.8 billion, while earnings before interest and taxes (EBIT) fell 68 percent to EUR 813 million.

Hapag-Lloyd has brought new ships and containers on board in 2024 to meet the additional capacity requirements due to the security situation in the Red Sea, said Habben Jansen.

With dozens of attacks since November, Yemen-based Houthi fighters have upended global trade by forcing ship owners to avoid the popular shortcut across the Suez Canal.

For the full year, the company expects EBITDA in the range of 3.2 to 4.2 billion euros. EBIT is likely to be between 1.2 and 2.2 billion euros.

Hapag-Lloyd stressed that the outlook is subject to a high degree of uncertainty against the backdrop of very volatile freight rates and major geopolitical challenges.

Transport expenses also rose by 5% to EUR 6.2 billion in the first half of the year, mainly due to higher fuel prices and higher fuel expenses as the situation in the Red Sea requires alternative long journeys around Africa.

(1 US dollar = 0.9099 euros)

(Reporting by Vera Eckert, editing by Miranda Murray and Elaine Hardcastle)