In a statement that revealed the company’s 2019 earning results, the CEO said production in China is now ramping up in factories and exports are increasing after weeks of labor shortages due to the ongoing COVID-19 outbreak.
“This health crisis has also affected global trade and we have therefore adapted our shipping services. Thanks to CEVA, we have been able to provide alternative solutions to our customers to avoid disruptions to their supply chains,” Rodolphe said.
CMA CGM revealed in its 2019 fourth quarter results that its the best operating performance in the shipping industry, with group revenue up 19.4 per cent to USD $7.5 billion (AUD $11.3b).
Rodolphe said the carrier’s in-house logistics arm Ceva Logistics, acquired in 2018 was a crucial element in servicing customers through February.
In 2019, CMA CGM posted a net loss of $229 million (after posting $34 million in profit the previous year) due largely to the 2018 acquisition and the investment required to return Ceva to profitable operations.
CMA CGM CFO Michel Sirat told Reuters the longer-term structural impact on the industry from COVID-19, could decrease the carrier’s 2020 total revenue by 2-3 per cent, or $100 million.
The shipping business delivered strong growth in the group’s results, driven by an increase of more than 4 per cent in volumes carried and a sharp decrease in the Group’s operating expenses across the year.
Fourth quarter revenue in the logistics business was affected by weak growth in the logistics market, caused mainly by a decrease in global air freight volumes and exchange rate effects.
In January 2020, CEVA Logistics embarked on phase two of its turnaround plan with a strengthened management team.
The Group is focusing on using a low-sulphur fuel (0.5 per cent) for its fleet following the new Low Sulphur rules implemented at the start of this year.
2020 will see the delivery of the first 23,000-TEU container ship powered by Liquefied Natural Gas (LNG) under a nine-vessel order.