CMA CGM enjoys post-pandemic boom

Oakland, California, USA - August 30, 2019 : Tugboat assists French container ship operated by CMA CGM out of the port of Oakland under blue sky. A tugboat maneuvers vessel by pushing, pulling or towing containership

CMA CGM has become the latest container shipping line to enjoy positive financial results despite the uncertainties caused by COVID-19, as it reported an increase in revenue across most of its operations in the second quarter of 2020.

Its group net income grew by approximately $246 million year-on-year (YoY), and in the shipping segment it also rose by $213 million. It attributed its good performance to its “agile business model” and synergies between its shipping and logistics segments.

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. 

How long will the carrier boom last?

“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.”

The carrier described the business environment of the second quarter as “unprecedented”. The COVID-19 pandemic has caused container traffic volumes to decrease for the first time since 2009 as a result of lockdown measures in several countries.

This resulted in the shutdown of production units, in particular in China, during the first quarter. This was then followed by a sharp downturn in global consumer demand in March and April, which caused a drop in traffic at many of the world’s busiest ports.

However, many carries have done well as freight rates have increased and oil prices have dropped, even though they are carrying less cargo than they did in 2019.

CMA CGM said it expects the recovery in container shipping seen since April to continue during the third quarter of 2020 for most routes, driven by faster recovery in the consumption of goods and the rapid growth of e-commerce.

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