Up and down in the second quarter, but CMA CGM may outpace its peers

A “strong” performance in the second quarter – “despite difficult market conditions” – saw CMA CGM Group post a net profit of $1.3 billion for the period.

Unusually, the French group of transport and logistics companies published its results for the second quarter on Friday evening, ahead of its peers, for example, Maersk did not publish until this Friday and Hapag-Lloyd next Thursday, August 10th.

CMA CGM Group’s revenue in the second quarter decreased 37%, compared to a bloated Covid revenue in the prior year of $12.3 billion, for a 73% reduction in EBDA, to $2.6 billion.

Liner revenue decreased 48 percent, to $8.4 billion, as a result of moving a steady volume of 5.6 million TEU — an increase of 11.5 percent over first-quarter lifts — in part due to a rebound in demand in some trades.

“Volumes remained strong on north and south lines, but across the Pacific, Asia and Europe were hurt by slowdowns in household consumption and falling merchant inventories,” CMA CGM said.

Compared to other Q2 liner details published so far, from OOCL, CMA CGM Container Services’ performance appears to be above the industry standard, given that subsidiary Cosco Shipping is well-known for being a leader in the health of the liner trade.

OOCL’s operating numbers in the second quarter reflected a 63% year-over-year decline in revenue, averaging $1,062 per TEU, versus $1,491 per TEU for the more respected CMA CGM.

In fact, after the year’s best quarter, shipping companies would have been expected to report essentially flat earnings in the remaining quarters, unless bolstered by a good peak season, which now appears to be something of a wet whack. Moreover, Israeli carrier Zim has already updated its full-year forecast from profit to loss of up to $500 million, and is offloading the excess load on early charter termination and rechartering of vessels.

Conversely, CMA CGM is the most active player in the container charter market, with shipbroker Braemar reporting six new formulations it approved last week, accounting for more than half of its representative list over the past seven days. CMA CGM also has a huge order book, second only to MSC, of ​​119 ships with a total nominal capacity of 1.2 million TEU.

In fact, Alphaliner speculated last week that CMA CGM’s growth aspirations could soon see it overtake Maersk to become the number two ocean carrier, in terms of fleet capacity.

Meanwhile, second-quarter revenue from CMA CGM’s rapidly expanding logistics operations was $3.8 billion, with interest, tax and depreciation accounting for $356 million, up 4.7% from a year earlier, but perhaps disappointing given the extensive slate of acquisitions in 2018. 2022.

“The stabilization of the logistics business, in the context of declining trade, reflects both a slowdown in freight markets and the strengthening of the overall supply chain services provided to CMA CGM Group’s clients,” she said.

Revenue from other activities of CMA CGM, including ports, terminals and air freight, decreased 5.3% to $474 million, compared to $50 million, which is a decrease of 62%,” mainly due to lower terminal volumes. Ports and Low Recovery Air Transportation Market.”