Zim delaying four 10,000-TEU ships until 2014-15

Zim delaying four 10,000-TEU ships until 2014-15    The Israeli liner carrier Zim said Thursday it has reached a deal to delay the delivery of four 10,000-TEU ships from 2010 until 2014 or 2015.
   That follows a recent agreement with shipyards in Asia to postpone the delivery of nine 12,600-TEU ships, also to 2014 or 2015.
   The delivery delays, the carrier said, will allow the company to defer payments due on the ships of up to $2 billion. That would theoretically allow the carrier to navigate what is expected to be a testing period through 2013, with Zim's parent Israel Corp. estimating the line will suffer a cash flow shortfall of $1 billion through 2013.
   'This extension of delivery dates marks a major step in completing Zim’s recovery plan,' the carrier said in a statement.
   Zim said that it had previously estimated the ocean transportation market would see a rebound in 2011, but rearranged those views as the downturn worsened and it became clear overcapacity would prevent the ocean carrier industry from recovering at the same pace as the global economy.
   'Prevailing industry forecasts anticipate significantly improved trade terms in 2012-2013, due to increased demand in world markets and the delay in delivery of new vessels,' Zim said. 'Based on this timeline the company expects to reach an operating profit of around $100 million in 2011, growing to about $350 million in 2012, and around $500 million in the year 2013.'
   The projected figures were released by Israel Corp. ahead of a pending general shareholders meeting to approve Zim's recovery plan. Israel Corp. said it would also use the meeting to seek approval for $450 million to support Zim's recovery plan, including a reduction in charter rates from a clutch of ship owners that lease containerships to the carrier.
   'This understanding reflects the shipyards' clear expression of confidence in Zim's recovery plan and in the company's long-term commercial success,' said Zim Chief Executive Officer Rafi Danieli of the ship delivery delays. 'As with the rest of the shipping industry, Zim has recently been faced with very challenging market conditions in the depths of a major downturn. Industry experts predict that by 2014-2015 we'll be well past the current crisis and the market will have recovered. Based on these estimates we look forward to strong market conditions that will enable Zim to grow, prosper and benefit from the new, efficient fleet at the right time.
   Danieli also said Zim was taking a conservative approach to the current crisis and that it is meeting its financial obligations, a week after Standard & Poor's lowered its bond rating for the carrier.
   'I would stress that Zim is not asking bond holders to write off any debt, instead requesting only to extend the original repayment schedule.'