The world’s third largest container shipping company CMA CGM reported an almost 90 percent decrease in its net profit for the second quarter of 2018, compared year-on-year.
The liner company said that its net income for the quarter came at USD 22.7 million, slashed from last year’s equivalent of USD 213 million.
Commenting on the results, CMA CGM’s CEO Radolphe Saade said that the company managed to preserve a positive net income in spite of a sharp increase in fuel prices.
“The group intends to pursue the cost reduction initiatives announced upon the release of its first quarter results to improve its operational and financial performance. These notably concern the optimisation of container fleet management and the improvement of energy efficiency,” CMA CGM said.
The volumes transported by CMA CGM increased by 9.6%, due to the strength of the Transpacific and Asia/Gulf lines within OCEAN Alliance, as well as lines from and to South America. Average revenue per container transported decreased slightly (2.1%) year-on-year.
CMA CGM’s revenue for the quarter increased by 7.4% as compared to last year, attaining USD 5.70 billion.
During the quarter, CMA CGM acquired Finnish business Containerships, a specialist in the intra-European market, as part of its strategy to strengthen its offering in the intra-regional trades.
Containerships is set to take delivery of four LNG-fuelled vessels with a 1,120 TEU capacity later this year. The acquisition, subject to approval by the relevant authorities, should be closed before the end of the year.
In Q2 2018, the company took delivery of the 20,600 TEU CMA CGM Jean Mermoz, designed to operate on the Asia-Europe trades, and strengthened its presence in the logistics sector with the acquisition of approx. 25% stake in CEVA Logistics.
In terms of the outlook, the company anticipates an improvement in its core EBIT margin in the second half of the year, due to the recent rise in freight rates and sustained of volumes.