ZIM sharply cuts guidance, sees 2023 operating loss

ZIM Integrated Shipping Services Ltd. (NYSE: ZIM) has cut its guidance for full year of 2023. The Israeli company now expects to generate adjusted EBITDA of $1.2 billion to $1.6 billion after previously expecting adjusted EBITDA of between $1.8 billion and $2.2 billion, and adjusted EBIT (operating loss) of $500 million to $100 million, compared with prior guidance of EBIT (operating profit) of between $100 to $500 million.

ZIM said its updated full-year 2023 guidance is driven primarily by continued weakness in freight rates across all the company’s routes, particularly in the Transpacific, which is now expected to continue during the second half of 2023. Volume growth is also expected to be lower than originally forecasted, Zim added, as demand continues to be subdued.

ZIM President & CEO Eli Glickman said, “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.”

He continued, “During this downturn, we will continue to actively manage and rationalize our fleet and services, to maximize 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 new-build capacity, particularly our new-build 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.”

Published by Globes, Israel business news – en.globes.co.il – on July 12, 2023.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.

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