The Board of Directors of the CMA CGM Group, a global player in sea, land, air and logistics solutions, met recently under the chairmanship of Rodolphe Saadé, Chairman and Chief Executive Officer, to review the financial statements for the third quarter of 2022.
Commenting on the results for the period, Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, said: “The CMA CGM Group once again recorded strong results in the third quarter.
"Over the past two years, we have significantly strengthened our financial structure and developed our business through the entire supply chain. Declining demand has prompted a return to more normal international trade flows and a significant reduction in freight rates.
"In this new environment, we will continue to invest to strengthen our positioning in maritime shipping and logistics, accelerate our energy transition and provide our clients with even more efficient solutions.”
Major investments to support the Group’s strategy
The third quarter of 2022 was shaped by persistent geopolitical tensions, which spurred higher inflation and dragged down consumer spending, which is increasingly shifting to services in the wake of COVID-19.
These factors dampened freight demand, but also helped to ease a certain amount of port congestions.
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In this environment, the CMA CGM Group pursued its strategy of strengthening its shipping, port, logistics and air freight capabilities, while making a significant commitment to energy transition.
The Group was also impacted by the unstable geopolitical situation, specifically by the increase in unit bunker costs driven by higher energy prices.
On a like-for-like fuel consumption basis, these higher energy prices led to a year-over-year increase of $822 million in bunker costs in the third quarter of 2022. The slowdown in shipping demand pushed down spot freight rates, particularly on main East-West routes.
Major investments to strengthen the CMA CGM Group’s industrial assets
To meet the energy transition challenges, the CMA CGM Group is pursuing its strategy of upgrading and increasing fleet sustainability, with: Two new 15,000-TEU, e-methane ready, dual-fuel container ships during the third quarter, the CMA CGM Galapagos and the CMA CGM Greenland, both French-flagged.
The CMA CGM Group is committed to achieving Net Zero Carbon by 2050 and intends to accelerate the energy transition in shipping and logistics, led by an enhanced energy mix.
Strengthened position as a global logistics provider
The acquisition of GEFCO was approved by the European competition authorities in July 2022.
As a European leader in contract logistics, specialized in finished vehicle shipping and other automotive logistics, GEFCO plays a key role in maintaining production line integrity across the European automotive industry.
Thanks to several acquisitions completed since the beginning of the year, CMA CGM has strengthened the capabilities of the Group’s subsidiary CEVA Logistics by integrating expertise and skills in e-commerce, last-mile delivery and automotive logistics, adding more than 12,000 employees.
Enhances its position as a port operator
The Group owns equity stakes in 50 port terminals in 33 countries. Its port operations are strategically designed to support the growth of its shipping lines and to enhance the quality of its customer services.
In the third quarter of 2022, CMA CGM bolstered its investment portfolio by winning, in association with its partner J M Baxi, the tender for the privatization of the Nhava Sheva terminal in India.
Signed on July 29, the concession agreement will support business development on the west coast of India, while upgrading and expanding a 700-meter-long container terminal berth at the Jawaharlal Nehru Port to deliver enhanced capacity and quality of service.
The investment has strengthened the CMA CGM Group’s position in a fast-growing regional and global market.
CMA CGM Air Cargo continues to expand
CMA CGM Air Cargo, CMA CGM Group’s air freight carrier, is continuing to expand with the recent launch of a new Paris-Hong Kong service, following delivery of its first two Boeing 777 freighters. Currently composed of six aircraft, the CMA CGM Air Cargo fleet will consist of 12 freighters by 2026.
Creation of a €1.5 billion Fund for Energies
In September, the CMA CGM Group announced the creation of a Fund for Energies, backed by a five-year, €1.5 billion budget, to accelerate its energy transition and achieve Net Zero Carbon emissions by 2050.
The Fund is dedicated to increasing the pace of decarbonization across the Group’s worldwide ocean, ground and air freight shipping activity, as well as its logistics business.
In particular, the Fund for Energies will support the development and industrial-scale production of renewable energies (biofuels, biomethane, e-methane, green methanol, etc.), while accelerating the decarbonization of port terminals, warehouses and land vehicle fleets.
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