EBITDA touches $1.2 billion thanks to tight control over operating margins
The CMA CGM Group has announced its numbers for the second quarter of 2020 showing improved profitability in all its business activities despite lower volumes carried thanks to tight control over operating margins.
Revenue for the period reached $7.0 billion, down 9.0% compared with the secondquarter of 2019, due to a slowdown in volumes related to the impact of the global public health crisis on international trade.
EBITDA improved once again, increasing 26.3% compared with the secondquarter of 2019, and reaching more than USD 1.2 billion.
The operating margin was $530 million, i.e., 7.6%, versus $286 million (3.7%) for the secondquarter of 2019.
During the secondquarter of 2020, the CMA CGM Group posted positive net income, Group share of $136 million, up sharply, compared with a loss of $109 million during the secondquarter of 2019, and a benefit of $48 million during the firstquarter of 2020.
The Group’s operating performance generated operating cash flow in excess of $1.1 billion.
Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, commented: “Despite the COVID-19 pandemic, our Group reported excellent results during the 2nd quarter, thus strengthening our financial structure.
"Thanks to our agile business model and synergies between our shipping and logistics business activities, we were able to adapt our service offerings to meet our customers’ fast-changing needs. We have also significantly reduced our costs and benefited from the drop in oil prices.
"CEVA Logistics’ turnaround plan is underway and in line with our expectations. During this public health crisis, preserving the safety of our employees was a top priority. Our teams have been working hard to ensure the Group’s and customers’ business continuity.
"Our expertise has been especially useful in combating COVID-19 by developing sea and logistical bridges to supply essential medical equipment. Third quarter results should mark a new improvement in our performance.”
As per the company's outlook recovery in container shipping seen since April should continue during the third quarter of 2020 for most routes, driven by faster recovery in the consumption of goods than of services, the growth of e-commerce, and usual seasonality.
These factors recently drove freight rates to historically high levels, in particular on transpacific routes where the Group is the world leader.