ZIM revises 2023 outlook, may report loss of $500-100mn
ZIM's updated 2023 guidance is driven primarily by continued weakness in freight rates across all trades
NYSE-listed ZIM Integrated Shipping Services (ZIM), a global container liner shipping company, now expects to generate adjusted EBITDA of $1.2 billion to $1.6 billion and adjusted EBIT loss of $500 million to $100 million compared to its prior guidance of adjusted EBITDA between $1.8 billion and $2.2 billion and adjusted positive EBIT between $100 to $500 million.
ZIM's updated full-year 2023 guidance is driven primarily by continued weakness in freight rates across all the company's trades, particularly in the Transpacific, which is now expected to continue during the second half of 2023, says an official release.
"Volume growth is also expected to be lower than originally forecasted, as demand continues to be subdued."
Eli Glickman, President & CEO, ZIM
Eli Glickman, President & CEO, ZIM says: "Near-term container shipping market conditions continue to be challenging with demand expected to remain muted for the remainder of the year. While our second quarter results are broadly in-line with our expectations, we no longer anticipate an improvement in freight rates in the second half of 2023, consistent with seasonality, as previously assumed.
"During this downturn, we will continue to actively manage and rationalise our fleet and services to maximise our cash position while remaining true to our customer-centric approach, a hallmark of ZIM's success. We expect our strong balance sheet and ample cash to continue serving ZIM well and allow us to maintain a long-term view. As we look to the future, we believe that our cost-effective and fuel-efficient newbuild capacity, particularly our newbuild LNG vessels, will markedly improve our cost structure and competitive position, allowing us to deliver sustainable value for both customers and shareholders over the long term."
ZIM had reported a net loss of $58 million in Q12023 with a 63 percent decline in revenue at $1.4 billion. While carried volume declined 10 percent to 769,000 TEUs, average freight rate dropped sharply (64 percent) to $1,390/TEU.
ZIM has operations in more than 90 countries serving over 34,000 customers in over 300 ports worldwide.