CEVA records $45 million Q2 loss

The global third-party logistics provider said continued efforts to cut costs and increase productivity resulted in an 11.6 percent year-over-year increase in adjusted EBITDA.    CEVA Logistics AG saw more red ink in the second quarter of 2018, reporting a $45 million loss, the same as in the second quarter of 2017, despite a 7.3 percent increase in revenues to nearly $1.85 billion, according to the Barr, Switzerland-based global third-party logistics provider’s most recent financial statements
   Diluted loss per share narrowed to $1.15 for the quarter, compared with a $3.91 per share loss in the same three-month period a year ago, primarily as a result of the issuance of almost 30 million new shares via an initial public offering and a concurrent private placement with CMA CGM Group, which is now a 24.99 percent shareholder in the company. Proceeds from the IPO and private share sale have been used primarily to pay down debt, and CEVA’s has been reduced from $2.2 million as of the end of Q1 to $1.1 million at the end of Q2.
   After excluding certain items and share-based compensation costs, as well as including proportional contributions from a joint venture between CEVA and ANJI, however, adjusted earnings before interest, tax, depreciation and amortization (EBITDA) climbed 10 percent to $77 million ($0.13 per share).
   In CEVA’s freight management segment, EBITDA surged 35 percent to $27 million for the quarter as revenues increased 8.1 percent to $853 million. Growth in the segment was helped by an 8.3 percent increase in ocean freight volumes, which was offset in part by a 1.3 percent decline in air cargo.
   “However, the implementation of important new contracts which were won during the spring tender season will drive volume growth going forward,” the company said.
   EBITDA in CEVA’s contract logistics segment was unchanged at $39 million, while revenues grew 6.8 percent year-over-year to $996 million.
   Through the first six months of 2018, total losses at CEVA have widened to $112 million compared with a $102 million loss in the first half of 2017.
   “CEVA continues to perform well. We now have achieved seven consecutive quarters of strong topline growth and stronger EBITDA,” Xavier Urbain, CEO of CEVA Logistics, said of the results. “We continue to reduce our cost base, work on productivity and address our underperforming activities. In the first half of the year, margin growth has been skewed towards Freight Management. We expect Contract Logistics to make more progress in the second half of the year as we have largely addressed the issues. We are committed to further improving our margins and are moving in the right direction.
   “Whilst still early days, initial benefits from the deleveraging through the IPO are already materializing,” he added. “We have increased business with some existing clients and are engaged in a number of promising discussions. In general, we have good momentum in business development. We are also making progress in developing our partnership with our new strategic shareholder CMA CGM.”