ZIM report net loss of $58mn in Q1, revenue down 63% to $1.4bn
Carried volume declined 10% to 769,000 TEUs, average freight rate dropped sharply (64%) to $1,390/TEU
NYSE-listed ZIM reported a net loss of $58 million for the first quarter ended March 31, 2023 compared to net income of $1.7 billion in Q12023 on lower volumes and sharp decline in freight rates.
While carried volume in the first quarter was 769,000 TEUs, a decline of 10 percent, average freight rate dropped sharply (64 percent) to $1,390/TEU, says an official release.
Revenue for the first quarter declined 63 percent to $1.4 billion, the release added. Adjusted EBITDA for the first quarter was $373 million, a year-over-year decrease of 85 percent. Operating loss (EBIT) for the first quarter was $14 million compared to operating income of $2.2 billion in the first quarter of 2022.
"Following a record year of adjusted EBITDA and EBIT generation, ZIM's first quarter results reflected the significant decline in freight rates and weak demand, particularly in the Transpacific trade, that began last year," says Eli Glickman, President & CEO, ZIM. "While the near-term outlook for container shipping remains challenging, the proactive steps we took during the preceding highly lucrative market period better position us now to meet these challenges and we believe our differentiated strategy will ultimately deliver sustainable value for shareholders over the long term.
"We continue to anticipate positive EBIT in 2023 despite macro and industry headwinds. Our expectation is for recovery in demand with inventory restocking to begin in the second half of this year, resulting in an improvement in freight rates. As such, for 2023, we have reaffirmed the guidance we shared earlier in the year of adjusted EBITDA of between $1.8 billion and $2.2 billion and adjusted EBIT of between $100 million and $500 million."
Net cash generated from operating activities was $174 million for the first quarter of 2023 compared to $1.7 billion in Q12022, the release added.