ZIM reduces first-quarter net loss, increases revenues

   ZIM said Wednesday it had a first-quarter net loss of $17.5 million compared with a net loss of $26.1 million in the first quarter of 2018.
   The Israel-headquartered container carrier said its first-quarter revenues were $796.2 million, an increase of 6% over the $751.4 million reported for the first quarter of 2018.
   ZIM carried 668,000 TEUs in the first quarter, 4.3% more than in the first quarter of 2018.
   “Since the fourth quarter of 2017 and until the second quarter of 2018, freight rates have decreased while bunker prices, as well as charter rates, increased, negatively affecting the industry as a whole,” ZIM said. “In the second half of 2018, freight rates started to recover, with a slight decrease during the first quarter of 2019, while bunker prices remained highly volatile. Confronted with a tough business environment, ZIM continued to record improvements and to introduce new services to its customers.”
    ZIM noted that in September, it entered into cooperation agreements with the 2M alliance of Maersk and MSC on five services between Asia and the U.S. East Coast. In the first quarter of 2019, the cooperation with Maersk and MSC was extended to two services between Asia and the East Mediterranean as well as on two services between Asia and ports on the West Coast of North America — Seattle, Vancouver and Prince Rupert.
   Eli Glickman, the president and chief executive officer of ZIM, said, “This cooperation is expected to create additional cost efficiencies, while enabling significantly upgraded service levels to our customers. Our focus and differentiating advantage remains our multiservice approach, combining best-in-market lines, premium and personal customer service and advanced digital solutions.”
   As with many other shipping companies, ZIM is applying revised International Financial Reporting Standards to leases. It said the new standard, IFRS 16, resulted “in a reduction in the company’s lease expenses, along with an increase in its depreciation expenses and interest expenses. Accordingly, the comparability of results in prior periods is limited.”
   A discussion of the impact of IFRS 16 on the shipping industry may be found on the website of the accounting firm PwC.