French maritime freight group floats to record returns

PARIS: French shipping and logistics group CMA CGM on Friday unveiled record third quarter profits of $5.6 billion on rising freight prices.

The group in August had already turned in a huge rise for second quarter net profits to $3.5 billion as liner shipping conditions float upwards despite the challenges posed by the pandemic over the past two years.

The Marseille-based group on Friday posted an 89.4 per cent rise in sales year-on-year to $15.3 billion, a rise “largely down to the group’s maritime activities”.

It added that it sees the upward trend continuing “at least through to the first half of 2022,” a turnaround from a $229 million loss booked in 2019 before 2020 saw net profits of $1.755 billion.

Despite the profit hike, the third quarter saw the group’s fleet transport 5.5 million containers, a 2.5 per cent fall the firm blamed on congestion at ports, as well as supply chain issues emanating from the slowdown largely induced by the pandemic.

The volume fall was more than made up for by the rise in maritime freight rates.

CMA CGM said the strong result had allowed it to pare down net debt to $11.9 billion as of September 30, a $4.5 billion fall in nine months.

The group, which has diversified into logistics with its recent purchase of Switzerland’s Ceva Logistics, has also invested $7.3 billion in a bid to lessen the fallout from the health crisis effect on supply chain issues and lay the groundwork for future sustained growth.

The company added that it has reached agreement with Airbus to take delivery of four A350F cargo planes for its new Paris-based air freight wing Air Cargo.

Furthermore it said that it has signed a $2.3 billion accord to add a 90 per cent stake in Los Angeles’ Fenix Marine Services terminal in Los Angeles, currently held by EQT Infrastructure III, to the 10 per cent it already owns.

In addition it has agreed a 35-year concession for Abu Dhabi’s new state of the art Khalifa container port, a joint venture with local AD Ports Group.