ZIM to earn $8bn in 2022, reports record Q1 earnings

Israeli carrier ZIM Integrated Shipping Services has increased its 2022 guidance and is expected to earn an EBITDA of $7.8-8.2 billion.

NYSE-listed ZIM reported its highest ever quarterly net income of $1.7 billion on doubling of average freight rate and higher carried volume. The carrier reported revenue of $3.76 billion, up 113 percent from Q12021, according to an official statement.

"Carried volume in the first quarter was 859 thousand TEUs, a year-over-year increase of 5 percent. Average freight rate per TEU in the first quarter was $3,848, a year-over-year increase of 100 percent," the statement added.

"Building on an extraordinary 2021 for ZIM, we maintained our strong trajectory in the first quarter of 2022, delivering on our commitment to outstanding execution and profitable growth," says Eli Glickman, President & CEO, ZIM.

"Driven by the proactive strategies we have implemented to capitalise on both the highly attractive market and ZIM's differentiated strategy, we once again generated our highest-ever quarterly revenues, net income and adjusted EBITDA, while achieving industry-leading margins.

"Consistent with our focus on identifying new profitable market opportunities, we have launched 10 new lines since the beginning of 2022, and we increased our carried volume quarter-over-quarter during a time when overall industry volume decreased. Our balance sheet remains very strong, with a positive net cash position combined with shareholder equity of approximately $4.3 billion at the end of the quarter."

Since the beginning of 2022, ZIM has announced chartering transactions for 17 new build vessels, "securing modern and efficient tonnage particularly well-suited to serve on our expanded network of expedited services," Glickman added. "Importantly, we will maintain flexibility to adjust our fleet size based on market conditions and be positioned at the forefront of carbon intensity reduction among global liners."

Collaboration with 2M partners
In February 2022, ZIM announced the formal extension and modification of its operational collaboration agreement with the 2M alliance partners, the statement said. Effective April 2, 2022, ZIM and the 2M partners began operating joint services on the Asia – US East Coast (USEC) and Asia – US Gulf Coast (USGC) trades based on a slot exchange and vessel sharing agreement. "Accordingly, ZIM currently operates two out of the six joint Asia to USEC services (ZCP & ZSE) as well as three additional vessels on one of two joint Asia to USGC services (ZGX)."

Cash generation
Net cash generated from operating activities was $1.6 billion in Q12022 compared to $777 million for the first quarter of 2021, an increase of 113 percent.

ZIM's total cash position (including cash and cash equivalents and investments in bank deposits and other investment instruments) increased by $1.3 billion to $5.1 billion at the end of March 31, 2022.