Evergreen employees get another godsend Ship’s crew

By Low De Wei and Cindy Wang (Bloomberg) —

Shortly after Taiwan’s Evergreen Marine Corp. granted its employees a bump bonus of 50 months, she’s handing out another juicy reward as she reaps the profits from a now-fading shipping boom.

The shipping giant’s roughly 3,100 employees received a total of NT$1.92 billion (US$62.8 million) in the latest payout, which comes from the company’s record profit last fiscal year, according to annual results released last week.

Shipping lines have benefited from an unprecedented industry-wide shipping boom over the past two years, fueled by a pandemic-driven surge in demand for consumer goods and freight rates. However, this has reversed in recent months as demand has fallen sharply amid economic uncertainty and rising geopolitical tensions.

The company pays out 0.5% of its profits as employee compensation under its charter, Evergreen Marine said. The bonus payments would be distributed according to the individual performance of the employees, it said.

In early 2021, a company ship got stuck in the Suez Canal. It posted a record net profit of NT$334.20 billion last year, but it fell short of analysts’ estimates.

“We are seeing signs that more customers are trying to renegotiate their long-term contracts with Evergreen, which could lower freight rates on long-term contracts that are critical to profitability,” wrote Kenneth Loh and Eric Zhu, analysts at Bloomberg Intelligence a note dated March 14.

Bloomberg News reported in January that workers received year-end bonuses averaging 50 months’ salary, or more than four years’ salary.

Employees’ year-end compensation and bonuses are based on the company’s performance for the year and individual performance, according to Evergreen’s annual report.

The stock is largely flat for the year after plummeting 54% in 2022. The company’s president, Hsieh Huey-chuan, said this week that the company is still confident this year that the shipping industry is expected to pick up in the second half, according to local media reports.

© 2023 Bloomberg LP

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