CEVA Logistics appoints new CEO in light of first quarter financial results

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CEVA has announced that Nicolas Sartini, who currently holds the position of Group Chief Operating Officer and Deputy CEO has been appointed Chief Executive Officer, commencing June 2019.

Rodolphe Saadé, Chairman and CEO of CMA CGM has been elected as Chairman of the CEVA Board of Directors with Rolf Watter acting as Vice-Chairman.

CEVA will implement a new strategic plan, prepared jointly with CMA CGM, in hopes that the two teams working together will drive improvements in CEVA’s financial performance after a challenging first quarter.

2019 Q1 results

Revenue increased by 1.1% in constant currencies to $1,698m. On a reported basis, the revenue in the first quarter declined by 5.2% year-on-year due to negative translation of foreign currencies. EBITDA was $134m in the first quarter of 2019. On a pre-IFRS 16 basis the Group’s EBITDA was $36m resulting in an EBITDA margin of 2.1%.

Revenue at the Anji-CEVA joint venture amounted to $369m, an increase of 6.6% in comparison to the same period of 2018. In constant currencies, revenue increased by 13.2% and EBITDA was $22m.

Revenue in Freight Management decreased by 0.7% to $797m in the first quarter of 2019 (Q1 2018: $803m). At constant currency rates, revenue increase by 3.8% year-on-year. CEVA continued to experience good volume growth in Ocean, up 6.2% year-on-year to 192,900 TEUs. Ocean yield was $288/ TEU, which demonstrated a strong increase compared with the fourth quarter of 2018 ($226/ TEU). EBITDA in the Freight Management division was down $2m year-on-year to $13m and EBITDA margins were down 30bps at 1.6%.

Air volumes decreased by 6.9% year-on-year, mainly from downtrading of some trade lanes and a selective approach to new business whilst Air yield increased by 2.2%. Air Freight reported weaker volumes than in the same period last year. The translation effect of some currencies negatively impacted EBITDA by a further $3m.

Revenue in Contract Logistics decreased by 8.7% to $901m (Q1 2018: $987m) due to significant currency impact hitting major geographies. At constant currency rates, revenue decreased by 1.1% year-on-year. EBITDA was down by $15m to $23m (Q1 2018: $38m). Despite productivity improvements in the majority of geographies and structural margin improvement in several low margin contracts, one of the two challenging contracts in Italy continued to weigh on the Group’s overall performance, and an additional provision of $10m was taken as described above. In addition, unexpected factory shutdowns in the automotive sector have negatively impacted performance in Central Europe and Brazil. As a consequence, the EBITDA margin was down 130 bps, a year-on-year decrease of 2.6%.

Source: CEVA Logistics