FRENCH shipping giant CMA CGM said its first-quarter group revenue fell 30 per cent year on year, becoming the latest ocean carrier to report sharply lower financials after two years of record profits for the industry.
The Marseille-based carrier's group revenue of US$12.7 billion driven mostly by the Group's maritime shipping business.
Net income amounted to $2.0 billion down from last year's Q1 net profit of $7.2 billion.
Q1 container volumes fell 5.3 per cent to 5 million TEU while the liner's average revenue per TEU declined 37 per cent in the first quarter to $1,766.
"After two exceptional years, our industry has entered a phase of normalization due to the slowdown in global growth, inflation and a destocking phenomenon that is continuing in many parts of the world," CMA CGM Group chairman and CEO Rodolphe Saade said in a statement.
"Despite this deteriorated context, our first-quarter results are extremely solid. They are the fruit of our investments - more than US$30 billion committed over the past two years - which enable us to constantly broaden and strengthen our range of transport and logistics solutions for our customers."
Mr Saade noted that the fourth quarter of 2022's trends remained in play in the first quarter of 2023, with challenging market conditions in the transport and logistics industry. Freight demand continued to slow, spurring a rapid normalization of spot freight rates.
Revenue from maritime shipping operations amounted to $8.9 billion, down 40.3 per cent from first-quarter 2022.
Revenue from logistics operations totalled $3.9 billion in the first quarter of the year.
Revenue from other activities (port terminals, CMA CGM Air Cargo, media, etc.) increased by 5.3 per cent to $405 million.
Looking ahead, the group noted that the second-half 2022 trends will continue to prevail in 2023, with deteriorated conditions in the transport and logistics industry.
"Macroeconomic forecasts for 2023 anticipate moderate global GDP growth over the year, in light of inflationary pressure which is dragging down consumer spending in OECD countries. However, this may stabilize later in the year. Nevertheless, new capacity delivered over the coming quarters is expected to continue weighing on freight rates in container shipping," the Group said.
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