CMA CGM expects its profit to ease further for the rest of the year after a first-quarter decline, as an uncertain economy and influx of new vessels cool the container shipping market after a record 2022.
The company, based in Marseille and privately controlled by the founding Saade family, on Friday reported a first-quarter net profit of $2.0 billion, compared with $7.2 billion in the year-earlier period, and said in a statement it expects the first quarter to be its most profitable of 2023.
CMA CGM is among shipping firms to have posted record profits last year, after the COVID-19 pandemic triggered a rush in maritime transport, and the group has poured its earnings into acquisitions to expand its logistics business and enter the media industry.
In a separate announcement on Friday, CMA CGM said it had offered to buy French online business newspaper La Tribune.
Earlier this month, CMA CGM agreed to buy the logistics operations of family-run conglomerate Bollore for an enterprise value of 5 billion euros ($5.5 billion) in what will be its biggest-ever deal if completed.
Integrating its acquisitions was the priority for CMA CGM, though it had "significant financial room for manoeuvre" with liquidity of around $25 billion that was above its debt level, Chief Financial Officer Ramon Fernandez told reporters during a call.
An expected increase of 8% in global shipping capacity, compared with forecast growth in global trade of just 1.5%, for this year would maintain pressure on freight rates, he said.
However, CMA CGM was seeing a recovery in its maritime volumes after a 5% year on year fall in the first quarter, and expects volume growth over the full year, said Fernandez, who joined CMA CGM this year from telecoms group Orange.
The group's recently established air cargo division saw a slow start to the year as demand softened following a surge during the pandemic, but CMA CGM aims to use its joint venture with Air France-KLM and the planned takeover of Bollore Logistics to boost the business, Fernandez added.
($1 = 0.9084 euros)
(Reuters - Reporting by Gus Trompiz, Editing by Louise Heavens)
