The first quarter of 2014 for France’s CMA CGM, the world’s third largest container shipping company, was marked by following seas, as the results were strong, in line with expectations.
The shipping volumes were up 5.8% and the operating performance proved to be resilient (4.7% of revenues) thanks to cost control which counter-balances lower freight rates, the company explained.
During the first quarter of 2014, CMA CGM’s revenue was up by 2.7% attaining $3,941 million.
Volumes have increased by 5.8% to 2.8 million TEUs. This relates to predominantly volumes on Asia- Europe lines, from and to the United States, as well as intra Asia lines, which have been particularly sustained.
CMA CGM said that it succeeded in limiting the decrease in average revenue per TEU to 2.9% compared to the first quarter 2013, a smaller decrease than that of the average of SCFI Compound (Shanghai Containerized Freight Index) of minus 8.6% as a result of the commercial strategy of the group.
The group has further developed its network as part of its effort to better respond to the needs of its customers with:
In terms of logistics, CMA CGM Logistics continues to roll out its services in Thailand, Brazil and India. While increasing its carried volumes, CMA CGM has leveraged its operational efficiency and further reduced its unit costs by 3.0%.
The operating margin has thereby reached 4.7% of the revenue, level again significantly above the average of the group’s peers.
During the first quarter of 2014, CMA CGM has continued the implementation of its financial strategy aiming at reinforcing its flexibility.
As a result, the amount of net debt has been reduced by 4.6%, and now represents less than 75% of the group equity. The consolidated available cash has been maintained at a strong level.
On May 12th, S&P upgraded the group’s rating, which now stands at B+ with a stable outlook.
With respect to the market outlook, CMA CGM said that it continues to record a sustained increase of its volumes.
“After a dip at the beginning of the second quarter 2014, freight rates are now back at supportive levels but should nevertheless remain volatile,” CMA CGM said, adding that the 9,000 TEU containership Danube will be delivered in the coming weeks.
“Finally, the P3 operational alliance was cleared by the US Federal Maritime Commission on March 24th. Review by the other relevant authorities is on-going. The implementation of the P3 operational alliance is now scheduled for Autumn 2014.”
[mappress] Press Release, May 27, 2014