• 2020 November 21 11:38

    Third quarter 2020 business activity strong CMA CGM Group operating performance

    The Board of Directors of the CMA CGM Group, a world leader in shipping and logistics, met today under the chairmanship of Rodolphe Saadé, Chairman and Chief Executive Officer, to review the financial statements for the third quarter of 2020.

    Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, commented: “In a favorable market environment for our industry, the Group reported very strong financial and operating performances due to the full commitment of its teams. Our shipping activity has seen a significant increase in volumes transported compared to the second quarter of 2020, and CEVA's transformation plan starts to bear fruit. This crisis has also demonstrated the solidity of our business model and demonstrated the relevance of our strategy, combining logistics solutions with transport offering. In a context of strong demand for the coming months, we will continue to respond with agility to the needs of our customers.”

    Business activities and financial performance of the third quarter of 2020

    The CMA CGM Group demonstrates strength and agility in an unprecedented global context

    The third quarter business activities saw a marked recovery in demand for transportation of goods, following the scaling back triggered by the Covid-19 pandemic during the first half of the year. In response to this recovery, the CMA CGM Group stepped up the redeployment of operated capacities during the third quarter, once again demonstrating the agility of its business model and the commitment of its employees.

    This increase in volumes transported was due to:

    • the pick-up in global economic activity following the easing of various lockdown measures;
    • the strong momentum in terms of the consumption of goods to the detriment of services activities, encouraged in some locations by support packages;
    • strong e-commerce growth with inventory rebuilding;
    • the usual seasonal variation in business activity in preparation for both the September and Christmas peak consumption periods in western countries.

    Strong financial indicators for the Group

    During the third quarter of 2020, the CMA CGM Group showed great responsiveness to support recovery in the sector. The health crisis has confirmed the relevance of the Group's strategy in terms of the complementarity between logistics solutions and maritime transport.

    Group revenue was up by more than 6% during the third quarter of 2020 compared with the third quarter of 2019, reaching a level of USD 8.1 billion.

     

     

     

     

     

    During the third quarter of 2020, the CMA CGM Group reports yet another solid improvement in Net Income Group share, with profits of USD 567 million, compared with USD 45 million during the third quarter of 2019 and USD 136 million during the second quarter of 2020.

    The Group’s operating performance generated an operating cash flow in excess of USD 1.8 billion, i.e. USD 814 million more than during the third quarter of 2019. The Group’s liquidity stood at USD 2.8 billion on September 30, 2020.

    Shipping: strong EBITDA growth of +76%

     

     

     

     

    Volumes carried during the third quarter of 2020 continued to recover and were up 16.8% compared with the second quarter of 2020. Volumes were also up 1% compared with the third quarter of 2019. Revenue for the quarter increased by 6.3% compared with the third quarter of 2019, totaling USD 6.3 billion for shipping, thanks to average revenue per TEU (twenty-foot equivalent unit) of USD 1,120, up 5.2% year-on-year, in particular on Transpacific trade lanes.

    Shipping EBITDA grew by an impressive 76% during the third quarter of 2020 to USD 1.5 billion (versus USD 870 million during the third quarter of 2019). Unit cost by TEU was down -6.8% compared with the third quarter of 2019, at USD 845 due to the combined impact of declining oil prices and the Group’s cost-cutting initiatives, notably in transportation and intermodal services. As a result, the Group has seen a strong 205.7% increase in its operating margin to USD 978 million.

    Logistics: a transformation plan which is bearing fruit



     

     

     

     

    CEVA Logistics continues to recover and is on course with its transformation plan. The effects observed in the second quarter of 2020 continued and improved during the third quarter.

    The revenues of the Group's logistics subsidiary stood at USD 1.9 billion in the third quarter, up 7.9% from the third quarter of 2019. EBITDA stood at USD 167 million, up 18.4% from the third quarter of 2019, and up from the second quarter of 2020 (USD 153 million).

    This performance was mainly supported by the turnaround in contractual logistics activities (warehousing solutions and related services) following the reopening of sites closed in the second quarter due to the health crisis. Airfreight momentum also remained strong with favorable margins despite the significant reduction in air traffic.

    The operating margin recovered from USD 12 million in the third quarter of 2019 to USD 39 million in the third quarter of 2020. Finally, the contribution of CEVA Logistics to net income Group share stood at USD 1 million compared to - USD 44 million in 2019.


    Highlights for the third quarter of 2020

    Liquefied Natural Gas, a pioneering choice for a new generation of container ships

    On September 22, the CMA CGM JACQUES SAADE joined the fleet. The Group's new flagship is the world's largest container ship powered by liquefied natural gas (LNG). The CMA CGM Group is firmly committed to the energy transition in maritime transport and is rolling out a plan aimed at providing the Group with a fleet of 26 LNG-powered ships by 2022. Liquified gas is an energy of the future, which preserves air quality by removing 99% of sulfur oxides, 91% of particulate matters and 92% of nitrogen oxide emissions. It enables the reduction of CO2 emissions by up to 20% compared with standard fuel oil engines.


    Development of expertise in air freight

    Building on its strategic development in logistics, the CMA CGM Group intends to increase its expertise in air freight. The CMA CGM Group has therefore signed a memorandum of understanding for the acquisition of a 30% stake in Groupe DUBREUIL Aéro (France's leading private airline group, owner of the airlines Air Caraïbes and French Bee). This transaction is subject to review by the competition authorities.

    Outlook

    Strengthening of the Group's financial structure

    In October, the Group went ahead and issued bonds worth EUR 525 million and prepaid its outstanding bonds due to mature in 2021.

    In addition, and in line with its debt reduction strategy, the CMA CGM Group will prepay USD 750 million of various debts in the coming weeks. These include the NOL (now CMA CGM Asia Pacific Limited) notes due to mature in 2021.

    Both rating agencies S&P and Moody's have adopted a favorable outlook on CMA CGM's debt rating (B + and B2 respectively).

     

     

    Ongoing momentum in world trade and earnings outlook

    During the fourth quarter, maritime activity is more sustained than during the third quarter due to the ongoing increase in volumes. This momentum is particularly marked in the United States and Latin America and allows the fleet to continue operating at full capacity as during the third quarter. As a result, freight rates remain high.

    In this favorable environment and thanks to the ongoing control of unit costs, the Group should see a further improvement in the EBITDA margin in the fourth quarter.

    About CMA CGM

    Led by Rodolphe Saadé, the CMA CGM Group is a world leader in shipping and logistics.

    Its 538 vessels serve more than 420 ports around the world, on all five continents. In 2019, they transported nearly 22 million TEU (twenty-foot equivalent units) containers. With CEVA Logistics, a world leader in logistics services, CMA CGM handles more than 500,000 tons of airfreight and 1.9 million tons of inland freight every year.

    CMA CGM is constantly innovating to offer customers new maritime, inland and logistics solutions.

    Present on every continent and in 160 countries through its network of 755 offices and 750 warehouses, the Group employs more than 110,000 people worldwide, of which 2,400 in Marseille where its head office is located.




2021 January 28

08:26 Port of Newport and CEMEX celebrate new agreement in support of construction industry
07:26 MAN Energy Solutions wins order to power ultra-large Hapag-Lloyd containerships
06:31 Hamburg Port Consulting implements IT integration for automated customs clearance for Cuxport

2021 January 27

18:41 BIMCO adopts new tug, barge and “floating hotel” contracts
18:12 ABS to class first Jones Act wind farm SOV
18:00 ICS published the latest Flag State Performance Table
17:41 Optimarin follows strong 2020 with fight for Norway’s Smartest Business title
17:16 Port of Savannah moves more than 4.6M TEUs in 2020
16:58 Corvette and tanker of RF Navy’s Baltic Fleet call at Limassol port
16:37 Port Of Tanjung Pelepas container volumes up 8% to 9.8 mln TEUs in 2020
16:25 Rosmorport's icebreakers started piloting vessels in Vanino seaport
16:02 New shoreside power system reduces carbon emissions at the Port of Gothenburg
15:41 NORMA Cyber to provide cyber security services to Norwegian shipping
15:04 Star Bulk Carriers announces delivery of three capesize vessels
14:54 TransContainer launched coal transportation in containers
14:29 Port of Rotterdam Authority joins BIM Basis Infra
14:00 RF Government approves draft agreement on exports of Belorussian oil products via seaports of Russia
13:27 24 vessel traffic systems of FSUE “Rosmorport” ensured navigation safety in 2020
12:56 Middle East Transport & Logistics Virtual Expo and Summit (METRANSLOG) to be held as a virtual event on March 8-9
11:45 Bunker prices are stable at the Port of Saint-Petersburg, Russia (graph)
11:42 Damen delivers RSD Tug 2513 to Tug Malta
11:13 FSUE Hydrographic Company outlines its dredging plans for 2021
10:39 Arctic infrastructure development through shipbuilding technologies to be discussed at PortNews’ Congress on March 10-11
10:10 Sibanthracite Group and VostokCoal Management Company sold Port Vera
09:48 MABUX: Bunker market this morning, Jan 27, 2021
09:46 Crude oil prices rise on reduction of US reserves
09:27 Kawasaki Heavy Industries delivers the bulk carrier IZUMI
09:12 Baltic Dry Index as of January 26
08:37 Van Oord presents Climate Risk Overview
07:19 DFDS acquires HSF Logistics

2021 January 26

18:31 DFDS invests in 35,000 sqm warehouse
17:47 ABS, NTU, Singapore, and ASTI joint study to explore the potential for ammonia as a marine fuel in Singapore
17:38 Marine Recruiting Agency trained 10% more people in 2020
17:35 Kongsberg signs a Letter of Intent with Yantai CIMC Raffles Offshore to deliver a large technology package for the BT-220IU Wind Turbine Installation Unit
17:16 MAATS Tech wins contract for major new build CLV with VARD Group AS
16:45 The centrepiece of SMM DIGITAL is the multifaceted conference programme
16:26 Neptune Declaration signed by over 300 maritime industry and human rights leaders
15:40 The Grande Texas enters the Grimaldi fleet
15:13 Single report only needed to sail across Flanders and the Western Scheldt
14:31 Krasnoye Sormovo to invest over RUB 200 million in upgrading and equipment modernization this year
13:59 Port of Baku cargo throughput increased by 20 percent in 2020
13:36 Rosmorport signs trilateral agreement with IBC Güler and "Infoline" Marine Agency LLC on using port infrastructure of Kavkaz seaport
12:50 Ro-ro ferry Marshal Rokossovsky intended for Ust-Luga-Baltiysk line undergoes mooring trials
12:27 Wärtsilä participates in EU-funded project to decarbonise long-distance shipping
11:32 USCG rescued 3 people off sinking crab fishing boat in Humboldt Bay
11:05 Contecon Guayaquil handles first carbon-neutral container shipment in the world
10:55 MOL's newbuilt LNG carrier "LNG Rosenrot" goes into service for Uniper
10:21 World’s first 100,000-ton deepwater semi-submersible production and storage platform built to ABS Class
10:11 MABUX: Bunker market this morning, Jan 26, 2021
09:29 Crude oil prices continue decreasing
09:12 Baltic Dry Index as of January 25

2021 January 25

18:06 Valenciaport leads Spain in natural gas supply operations
17:56 Russian Fishery Company develops new markets
17:28 Vanino coast stations of sea areas A1 and A2 GMDSS successfully passed regular survey
17:05 DNV GL awards AIP to KSOE for wing sail propulsion system
16:05 Wärtsilä signs a five year extension to its Optimised Maintenance agreement with Golar
15:59 Port of Ventspils increased handling of wood products
15:04 ABS awards industry’s first AIP for deep-sea mining vessel to CMI
14:27 Average spot market price for Russian M100 product climbed to RUB 18,710 pmt
14:02 Konecranes and Calata Bettolo container terminal in Genoa join forces on complete container handling solution