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CMA CGM posts larger Q3 loss after completing NOL takeover

CMA CGM posts larger Q3 loss after completing NOL takeover

France’s CMA CGM has posted a larger loss for the third quarter ended 30 September after completing the acquisition of Singapore’s Neptune Orient Lines (NOL).

The third quarter loss was reported at $268m, wider than the loss of $202m excluding NOL’s contribution since its consolidation on 14 June 2016.

The process of integrating NOL into CMA CGM continued during the quarter and delivered its first commercial and operating results, with more than 20 new shipping alliances set up between NOL’s boxship operating arm APL and CMA CGM, and the deployment of a synergy and rationalisation programme.

The full reorganisation of the APL and CMA CGM lines will be completed with the deployment of the Ocean Alliance in April 2017. The Ocean Alliance comprises of Cosco Container Lines, Evergreen and Orient Overseas Container Line (OOCL).

The third quarter loss was also a reversal of fortune compared to the profit of $51m in the same period of 2015.

Third quarter revenue amounted to $4.47bn including NOL, down from $3.98bn in the year-ago period, due mainly to continued pressure on freight rates despite higher volumes.

Volumes carried by CMA CGM came up to 4.5m teu for the third quarter, up nearly 36% year-on-year thanks to the integration of NOL.

“Shipping companies have continued to take measures to adjust the deployed capacity hence resulting in a better alignment between effective capacity (net of scrapped vessels) and volumes carried,” CMA CGM stated.

“Freight rates have improved slightly but remain nonetheless at a historic lows. Against this backdrop, the group will continue to focus on the integration of APL, additional cost savings and the quality of service provided to its customers.”

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