French shipping giant CMA CGM, reported a 66.7% jump in net profit to $156m in the second quarter of 2015. The result compared to a $94m net profit in the same period a year earlier.
The world’s third largest container line says that its unit costs fell 10.9 percent year on year, thanks to falling oil prices, reporting operating expenses during Q2 at $3.7 billion compared to $3.9 billion during the same period last year.
Volumes carried during the second quarter increased 6.2 per cent year on year to 3.3 million TEU, compared to global market volume growth of one to two per cent.
The improved profitability came despite a 2.1% fall in revenues to $4.11bn in Q2 2015, compared to $4.2bn in the same period a year earlier.
Commenting on the result CMA CGM said: “In the second quarter, CMA CGM demonstrated the strength of its business model by significantly outperforming the market, despite a sharp fall in freight rates and industry overcapacity.”
The company's fleet is said to have grown by 8.6 percent year on year, with 37 boxships increasing the carrier's capacity by 12.2 percent, or 467 vessels from 430.
The container line increased volumes in Q2 by 6.2% year-on-year to 3.3m teu. While average revenue per teu dropped 7.8% year-on-year, lower fuel costs also helped the line to 10.9% reduction in unit cost.
CMA CGM upgraded services in fast-growing markets. It reported vigorous growth in its lines to and from the US partly on the weakness of euro, which boosted European exports to the US, particularly reefer cargo.
In common with other companies in the sector CMA CGM sees little prospect of an improvement in freight rates in the third quarter. “During the third quarter, freight rates are expected to remain particularly volatile for Asia-Europe and Asia-Mediterranean lines. As a result, CMA CGM will continue to adjust its capacities.”
Two new 9,400-TEU vessels joined the Group’s fleet: CMA CGM Tage and CMA CGM Thames. These vessels are designed to operate within the expanded Panama Canal and are currently positioned on fast-developing lines. During the period, the Group also took delivery of CMA CGM Kerguelen and CMA CGM Georg Forster, the first two vessels in the 18,000-TEU series.
Separately, the consortium formed by CMA CGM, Bolloré Africa Logistics and the China Harbour Engineering Company (CHEC) have won a tender initiated by the West African state of Cameroon to operate the port of Kribi Container Terminal within the framework of a 25-year concession.