The Israeli shipping company ZIM has experienced significant growth during the second quarter of 2024 (2Q24), driven by its strategy to increase its exposure to the spot market in the transpacific trade, according to its financial results report.
The company, considered the ninth largest shipping line in the world, recorded a net profit of $373 million in 2Q24, compared to a net loss of $213 million in 2Q23.
“(Greater exposure to the spot market in the transpacific trade) has allowed us to capture a significant increase in a tariff environment that has been elevated for longer than expected,” said Eli Glickman, President and CEO of ZIM, as quoted in the quarterly financial report.
The company also detailed that the average freight rate per TEU (20-foot container) was $1,674 during the second quarter of 2024, compared to $1,193 in the second quarter of 2023.
Additionally, the shipping line reported transporting a total of 952,000 TEUs from April to June, compared to 860,000 TEUs in the second quarter of 2023.
Currently, ZIM offers 12 transpacific services, connecting ports in China, Japan, South Korea, Vietnam, Malaysia, Thailand, and India with their counterparts in the United States, Canada, and a few limited calls at Latin American ports in Mexico, Colombia, Panama, and Jamaica.
In other lines of its financial statement, ZIM reported that total revenues for 2Q24 were $1,933 million, compared to $1,310 million for 2Q23, primarily driven by increased freight rates and transported volume.
Operating income (EBIT) for 2Q24 was $468 million, compared to an operating loss of $168 million for 2Q23.
Adjusted EBITDA for 2Q24 was $766 million, compared to $275 million in 2Q23. Adjusted EBIT was $488 million for 2Q24, compared to an adjusted EBIT loss of $147 million for 2Q23.
Eli Glickman indicated that they expect their results in the second half of 2024 to be better than in the first half of the year, driven by the ongoing supply pressures from the Red Sea crisis, combined with current favorable demand trends.
“As a result, we have significantly increased our full-year 2024 guidance, and today we forecast adjusted EBITDA for the year between $2.6 billion and $3 billion, and adjusted EBIT between $1.45 billion and $1.85 billion,” he said.
“While market fundamentals still indicate that supply growth significantly exceeds demand, we are confident that we have built a resilient business with a transformed fleet. By year-end, our ongoing newbuilding program will be complete, as we will receive delivery of the remaining eight of the 46 modern, fuel-efficient container ships we acquired, including 28 LNG-powered vessels,” he added.
According to Alphaliner, ZIM ranks as the ninth-largest shipping line in the world with 747,194 TEUs under its management and 130 container ships.
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