ZIM has posted a loss (before income tax) of US$65 million for the first quarter of 2023.     

The ocean carrier’s results for the three months ended 31 March are down from a profit before income tax of US$2.2 billion in the same period last year.

Revenues fell to US$1.4 billion, down 63% from US$3.7 billion posted in the first quarter of 2022.

Average freight rates also plunged, down 64% year-on-year to US$1390 per TEU, while carried volumes in the first quarter fell 10% to 769,000 TEU.

“Zim’s first quarter results reflected the significant decline in freight rates and weak demand, particularly in the trans-Pacific trade, that began last year,” Zim president and CEO Eli Glickman said.

“While the near-term outlook for container shipping remains challenging, the proactive steps we took during the preceding highly lucrative market period better position us now to meet these challenges.”

Mr Glickman said Zim adapted its vessel sourcing strategy to improve cost structure and added fuel-efficient newbuild tonnage, which he believes will “overhaul” the company’s fleet profile.

“These include ten 15,000 TEU dual-fuel LNG vessels, which are ideally suited for our core Asia to US East Coast service, and 36 smaller, more versatile vessels, 18 of which are also dual-fuel LNG, that will enable Zim to operate a fleet best suited for our trades and services.

“At the same time, our strong balance sheet and ample liquidity further make us confident that the Company will operate from a position of strength even amidst current market headwinds.”

Zim’s adjusted EBITDA for the first quarter was US$373 million, a year-over-year decrease of 85%, and adjusted EBIT loss was US$14 million.

Mr Glickman said Zim anticipates positive EBIT in 2023 despite macro and industry headwinds.

“Our expectation is for recovery in demand with inventory restocking to begin in the second half of this year, resulting in an improvement in freight rates.

“As such, for 2023, we have re-affirmed the guidance we shared earlier in the year of adjusted EBITDA of between US$1.8 billion and US$2.2 billion and adjusted EBIT of between US$100 million and US$500 million.”