CMA CGM, france, reported a $100 Million net loss in its first quarter on Friday, whereas it reported a 2.9% increase in volumes during the first quarter, to 3.2 million TEU, beating the market which grew by 1.2% (source: Drewry) and focused on maintaining its core EBIT margin.
The increase is mainly attributable to growth in the Transatlantic and Transpacific lines operating to and from the United States, which offset the decrease in volumes carried between Asia and Europe, where the Group had scaled back its capacity in response to weaker demand. Consolidated since 1 July 2015, OPDR also contributed to the increase in volume.
In an environment characterised by strong pressure on freight rates, average revenue per TEU fell 17.6%, a decrease that remains smaller than the average decline in the Group’s benchmark indices and reflects the ongoing imbalance between supply and demand.
CMA CGM’s revenue came in at $3.4 billion for the period, down as compared to first-quarter 2015 when the Group benefited from particularly favourable freight rates and volumes.
CMA CGM continued to implement its cost control policy, once again reducing its unit costs in the first three months of the year. This enabled the Group to achieve core EBIT of $3 million despite challenging conditions.
The Vice-chairman Rodolphe Saade said, ”In a very difficult environment, we have in the first quarter recorded an increase in volumes above the market average, while maintaining a positive core EBIT margin. We will continue our strict financial discipline, including the implementation of a significant cost reduction plan.”
Highlights and outlook of CMA CGM Group
Roll-out of a $1-billion cost reduction plan
CMA CGM has initiated a new plan to cut costs by $1 billion within 18 months. The programme will be rolled out in 2016.
Source: CMA CGM
