CMA CGM FY2013: Sustained expansion and solid performance


CMA CGM has released the latest statistics for FY2013, reporting a stable year despite a weaker freight rate environment.

Consolidated revenue remained stable despite freight rate concerns, dropping just 0.1 percent, standing at US$15.9 billion.

Net profit rose a staggering 22.8 percent over the year to $408 million, partly as a result of the sale of 49 percent of Terminal Link, a terminal activities subsidiary in June.

Despite rate concerns, annual container volume carried increased by 7.5 percent from 10.6 million TEU to 11.4 million TEU, in a market where volumes increased by around three percent over the year.

As a result of this, decrease in average revenue per TEU was held at 7.1 percent, much less that the decline in the corresponding Shanghai Containerized Freight Indices (SCFI).

This increase in volume is tied in with the launch of a new e-commerce platform and the arrival of two new 16,200 TEU megaships, all in the hopes of further expansion and market growth.

Yet, whilst deploying this strategy, CMA CGM managed to maintain operating costs in persistently difficult market conditions, resulting in a 5.3 percent decrease in costs per TEU and an operating margin of 4.8 percent, one of the industry’s highest.

CMA CGM aims to continue on an equally solid footing in 2014, with hopes that container volumes increase by 4 to 5 percent in 2014.

Nevertheless, they expect freight rates to remain under pressure throughout the year, given over saturation of the market as supply often exceeds demand.

In response, the Marseille-based company is continuing to deploy a strategy combining both financial discipline and assertive marketing in an attempt to better operating performance.

Focus is expected to turn to fast growing regions, with plans for new services and the development of port infrastructure, most notably in Africa, where CMA CGM plan on strengthening pre-existing lines via the development of overland corridors and the opening of new agencies and logistics terminals.

Further benefit should come from the development of their reefer container fleet, which should account for about 50 percent or 48,000 units of the total fleet by the year end.

Finally, with the deployment of the P3 operational alliance in partnership with AP Moller-Maersk and MSC, CMA CGM hopes to increase operating efficiency exponentially by increasing fleet utilisation.

Discussing the year, Rodolphe Saade, CMA CGM group executive officer said “In 2013, in a difficult market, we successfully reduced our costs while increasing our volumes carried much faster than the market, enabling us to report one of the industry’s best financial performances. In this way, year after year, we are reinforcing our position as the world’s third largest container shipping company.”

“With these solid fundamentals and the pioneering spirit that has always been our strength; we are committed in 2014 to maintaining our profitability and driving faster growth.”

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