CEVA boosts 2015 profits despite falling revenues

Non-asset based supply chain management provider CEVA Holdings LLC grew its adjusted earnings 13.8 percent to $272 million in 2015 despite revenues dropping 10.3 percent compared to the previous year.    CEVA Holdings LLC grew its adjusted earnings before interest, taxes, debt and amortization (EBITDA) 13.8 percent to $272 million in 2015 compared with the previous year, according to the company’s most recent financial statements.
   Revenues at the non-asset based supply chain management provider, however, fell 10.3 percent to $6.96 billion for the full year. CEVA, which is headquartered in Hoofddorp, the Netherlands, noted that at constant currency exchange rates, adjusted EBITDA was up 22.2 percent, while revenues dipped just 0.5 percent.
   In the fourth quarter of 2015, CEVA posted EBITDA of $66 million, down 10.8 percent from the same 2014 period, on revenues that dropped 13.5 percent to $1.72 billion. The company said in constant currency, earnings and revenues slipped 1.4 percent and 5.1 percent, respectively, for the quarter.
   CEVA’s Freight Management division saw its 2015 adjusted EBITDA skyrocket 241 percent year-over-year to $70 million in constant currency. Fourth quarter earnings grew 20 percent to $15 million compared with the fourth quarter of 2014.
   The company said its airfreight volumes “increased marginally” despite what it characterized as a “short peak season,” as exports from Asia performed relatively well in the fourth quarter.
   “Air Freight outperformed the market in Q4 due to a number of new business wins on selected tradelanes from Europe to China,” said CEVA.
   Ocean freight volumes, on the other hand, underperformed against market, according to the company, which said it will continue to focus on “attractive” trade lanes.
   “A strategic procurement approach in a low-rate environment contributed to margin improvements in both Air Freight and Ocean Freight,” it added.
   The company increased full-year revenues 1.5 percent in its Contract Logistics segment compared with 2014, leading to “stable” EBITDA of $202 million. CEVA said revenues in the fourth quarter were down slightly from the year before, due to falling volumes in certain geographical regions as well as general economic volatility.
   “CEVA’s 2015 year-end performance is the latest in a series of strong quarters for our company.” CEVA CEO Xavier Urbain said of the results. “We see that the execution of our new strategy, launched in 2015, is delivering tangible results despite the volatile year-end economic environment and short peak season. Of our 17 geographical clusters, 15 performed at or above expectations in 2015, which shows that our operating model is working. We also see a number of opportunities to further improve our EBITDA in 2016 driven by continued investments in our field sales teams and operations.”
   “Ongoing process and product improvements in all business lines continues to pay off and our emphasis on quality trade lanes allowed us to gain share on key routes during the course of the year,” he added. “Our organizational transformation continues and we’ve recently renewed our focus on enhancing opportunities within our Ground transportation organization. CEVA’s assertive investment in field sales teams has led to successfully capturing new customers in 2015, particularly with small to medium enterprises.”