ZIM reports 2023 loss of $2.7bn on lower freight rates

 ZIM reported a 59 percent decline in revenue at $5.2 billion for the year ended December 31, 2023 on 63 percent decline in average freight rate at $1,203/TEU compared to $3,240/TEU in 2022.

Net loss for the full year of 2023 was $2.7 billion compared to net income of $4.6 billion 29 for the full year of 2022, driven mainly by the decrease in operating income (loss) and the $2.1 billion impairment loss, says an official release.

ZIM carried 3,281,000 TEUs in 2023 compared to 3,380,000 TEUs in 2022, a drop of three percent.

For the fourth quarter of 2023, revenue declined 45 percent to $1.2 billion, net loss came in at $147 million and volume carried was at 786,000 TEUs, down four percent. Average freight rate per TEU in the fourth quarter was $1,102, a year-over-year decrease of 48 percent.

"Against a backdrop of weakened market conditions, industry disruptions and operational challenges in 2023, ZIM's exceptional team of professionals remained resilient and intently focused on achieving operational excellence and delivering the highest level of care for our valued customers," says Eli Glickman, President & CEO, ZIM. "At the same time, we made significant progress advancing our strategic transformation and are pleased to have already started to realise the favourable outcomes we projected. Specifically, we are well on our way to markedly improving our cost structure, enhancing our commercial resilience, and enabling reduced carbon emissions for both ZIM and our customers moving forward.

"Our fleet renewal programme, which includes 46 newbuild containerships, focuses on shifting ZIM's reliance on older, less fuel-efficient vessels to a cost and fuel-efficient, more sustainable and largely LNG-powered newbuild fleet, and is progressing as planned following the delivery of 24 new vessels to date. Our cost per TEU is declining and we anticipate additional improvements as our 22 outstanding newbuilds are delivered during the remainder of the year. We continue to review our services to best address customers' evolving needs and position ZIM to capitalise on attractive growth opportunities.

"During a time when the market remains volatile, our strong cash position will enable us to continue to maintain a long-term view as we focus on generating sustainable value for both customers and shareholders. Looking ahead, we intend to continue to take decisive steps to further benefit from our strategic transformation and expect ZIM to emerge in a stronger position than ever in 2025 and beyond."

2024 guidance
ZIM expects to generate an adjusted EBITDA between $850 million to $1.5 billion, and adjusted EBIT between a loss of $300 million and earnings of $300 million in 2024.