CMA CGM posts earnings surge in Q3, expects even stronger Q4

Paris

SHIPPING group CMA CGM last Friday (Nov 19) reported a surge in third-quarter earnings and said it expected an even stronger performance for the end of the year as intense demand kept freight rates high and container capacity stretched.

French-based CMA CGM, one of the world's largest container lines, said net profit rose to US$5.6 billion in the third quarter from US$567 million in the same period last year, while core Ebitda earnings rose to US$7.1 billion from US$1.7 billion.

An economic rebound following a coronavirus pandemic has disrupted supply chains and exacerbated logistics problems like ageing infrastructure and driver shortages.

Maersk, the world's largest container line, said this month that port delays would persist into next year.

"The pressure on effective shipping capacity for consumer goods observed since the summer of 2020 is expected to persist until at least the first half of 2022," CMA CGM said.

"The current context is thus likely to enable the group to achieve an even stronger financial performance during the fourth quarter."

The group, which is privately controlled by the Saade family, had increased its shipping capacity by nearly 6 per cent in the year to September 2021, it said.

The company has also expanded like Maersk in non-maritime transport, using the acquisition of CEVA Logistics two years ago and the creation of an air freight division this year. As part of its air cargo push, CMA CGM announced with Airbus last Friday an order for four A350F freighter jets.

Rising earnings have helped CMA CGM accelerate investments this year, including the planned acquisition of a port terminal in Los Angeles for around US$2 billion.

The group also said its net debt had fallen sharply, standing at US$11.9 billion as of Sep 30, down US$4.9 billion compared with the end of last year. REUTERS