During the quarter ended September 30, ZIM Integrated Shipping Services Ltd (ZIM) recorded its best results since Q3-2010, resulting from a recovery in the market, internal measures to drive greater cost-effectiveness, and positive seasonal factors.
Revenues during the quarter amounted to $1.064 billion – a 9 per cent increase compared with the same period last year, resulting from a 10 per cent increase in average freight rates compared with the same period last year (from $1,310 per TEU to $1,444 per TEU this quarter). ZIM carried 617,000 TEUs, a decrease of 4.5 per cent compared with Q3 of 2011, and a 2 per cent increase compared with Q2-2012.
ZIM achieved an operating profit (EBIT) of $80 million compared with an operating loss of $63 million in the same quarter last year – a $143 million improvement, and a positive EBITDA of $125 million – a $140 million improvement compared with Q3 of 2011. Compared to the previous quarter, the company reached an improvement of nearly $80 million in operating profit and in EBITDA.
Operating cash flow improved to $102 million in Q3, compared with operating cash flow of $23 million during the same quarter last year and of $24 million in the previous quarter – a nearly $80 million improvement.
ZIM recorded a net profit to shareholders of $16 million in Q3, an $82 million improvement compared with the same quarter of last year in which the company recorded a $66 million loss, and a $63 million improvement compared with the previous quarter in which the company recorded a $47 million loss.
The company’s liquidity improved this quarter as well, due to the positive operating cash flow and due to refinancing transactions that were completed during the quarter. Total liquid assets amounted to $182 million at the end of Q3, compared with $159 million at the end of the previous quarter – a $23 million improvement.
Looking ahead, ZIM believes that the industry continues to be vulnerable, primarily because of the looming increase in capacity as new-builds continue to enter the market, resulting in supply-demand imbalances and pressure on freight rates. In addition, oil prices remain volatile, and the global economy remains weak.
In view of those factors, market conditions in the fourth quarter of this year and thereafter may be volatile or worse than in the third quarter.
ZIM continues to entertain discussions with government officials about a possible split of the company into an international unit and an Israel-focused unit, the objective of which is to release the international unit from the constraints imposed through the current state veto power over changes to ZIM’s charter, thus enabling it to enjoy greater flexibility to meet competitive requirements. The international unit would comprise about 85 per cent of the carrier’s current business.
ZIM is pleased to note that Q3’s operating results are in excess of above the industry averages, based on recorded results of publicly-held international shipping companies, demonstrating the considerable improvement in the company’s performance and its improved competitive position.