The Israeli carrier is focused on improving customer service and strenghtening services.
ZIM expects continuing improvement in its financial performance in the current quarter, following its financial restructuring in the summer.
“The trend is positive for us,” said Nissim Yochai, vice president of customer relations. “We are very confident that that will continue.”
The Israel-based container liner carrier is making progress following its business plan, he said, and has eliminated money-losing services such as that between Asia and North Europe.
“Our next step will be to continue improving on the trades where we believe we have added value to our customers,” such as service to the East Mediterranean and Black Sea, from the West Med to the East Coast of the United States, and the intra-Asia and transpacific trade.
“This is where we are investing heavily,” said Yochai.
ZIM reported a net loss of $63 million in the third quarter —a $20 million loss on a non-GAAP basis — compared to a $76 million loss in the third quarter of 2013.
Guy Eldar, the chief financial officer of ZIM, noted that the company reported results on a non-GAAP basis to eliminate “noise” related to the company’s restructuring, and he said in the fourth quarter, the two numbers will be more similar.
“Hopefully, in the fourth quarter, we will be able to continue the improvements which, if everything goes as it looks today and as is planned, will eventually lead to a positive bottom line,” he said.
Yochai said the company’s transpacific business “has been strong through the peak season. So far it’s been holding, so we hope it continues.”
Though there has been some weakening in recent weeks, “we are looking for better results towards the Chinese New Year and after the New Year.”
Like other members of the Transpacific Stabilization Agreement, ZIM last month announced plans to impose surcharges on cargo moving through West Coast ports because of congestion, but then postponed them.
“We are suffering the same as everybody,” said Yochai, pointing to delays in vessels berthing and containers moving through terminals on the U.S. West Coast. He said the company moves a lot of cargo through Vancouver to both U.S. and Canadian customers, and has faced congestion there as well.
“We are working very closely with our customers; we are trying to be very proactive,” he said.
He said the company is looking for an upturn in its business to and from the Eastern Mediterranean and Black Sea, noting that the conflict in Ukraine with Russia has had some impact on trade as has the decision by some carriers to cascade ships that had been deployed in the Asia-North Europe trade into the Black Sea.
“We are monitoring the situation and will try to maintain our competitive advantage,” he said.
ZIM is not a member of one of the large global alliances like 2M, Ocean Three, G6 or CKYHE, and Yochai said the company is “able to work with all of them, so we do not find that is an obstacle, really.”
At its home base, ZIM has about a 30-percent market share in Israel, but faces vigorous competition, with about 17 lines now serving the country.
“It is very competitive, specifically coming from the Far East — that is the main competition — and we have obviously some competition going to the Atlantic, East Coast of the U.S. and to northern Europe,” he said.
He said two new terminals are being developed in Haifa and Ashdod to accommodate large containerships with capacity of more than 13,000 TEUs, but those are not expected to be completed for five or six years.
Yochai said ZIM is planning for the opening of the expanded Panama Canal in early 2016, and he expects the carrier will need to deploy a string of larger ships — in the 10,000 TEU-13,000 TEU capacity range — to remain competitive in the Asia-U.S. East Coast trade. But he said the company has not finalized plans and it may build or charter vessels, depending on both its financial situation, and the cost and availability of charter tonnage.
As part of its restructuring, ZIM did say that eventually it would seek to list its shares in one of the stock exchanges, but Eldar said it is premature to discuss plans for a public float.
“With a new board, which was appointed post-restructuring, and the new chairman, who was just appointed about a month and a half ago, they need to spend some more time before they, together with the management decide on the right time to list the company or together with that maybe do an IPO,” Eldar said.
ZIM sees financial position improving
