CEVA’s losses up to $198m for year-to-date

CEVA’s total revenue increased by 4.7% year-over-year in constant currency terms in the third quarter of 2018. Excluding one-time provisions impacting the Italian Contract Logistics operation, business continued to perform broadly in line with management’s expectations with an adjusted EBITDA of $55m in the third quarter of 2018. Progress was made in productivity, cost reduction and other margin improvement initiatives. However, for the nine months ended September 30, CEVA’s EBITDA has dropped 14.5% to $148m. The company made a net loss for the period of $75m. Over the last nine months, it has made a net loss of $198m.

New contracts and extensions were won in this quarter. In Air and Ocean freight, CEVA won contracts with technology and automotive customers, whilst in Contract Logistics this was mostly with automotive, healthcare, consumer & retail clients. The partnership with CMA CGM has also started to deliver additional opportunities, according to the company.

Revenue in Freight Management increased by 4.9% on a reported basis and by 6.8% in constant currency in the third quarter of 2018 compared to the same period last year. EBITDA has decreased by $3m year-over-year to $22m with better revenues offset by challenges in North America relating to the increased cost of transportation due to driver shortages, partly eased by improvements in the value added services operation. 

Contract Logistics revenue increased by 2.8% in constant currency, but decreased by 1.4% on a reported basis in the third quarter of 2018. CEVA had unplanned additional costs of $26m in the third quarter due to two contracts in Italy and the bankruptcy of a local Italian partner that supplied temporary staff. As a result, EBITDA was $7m for Q3, down from $43m in the same period the previous year.

Anji-CEVA revenues grew to $1,069m in the first nine months of 2018, up 17.6% on last year. Its EBITDA for the same period was $99m.

CEVA has also reported that it has successfully completed its comprehensive refinancing in August 2018.

Although 2018 will be impacted by the contract logistics issues in Italy, CEVA is hoping to grow revenue and to increase EBITDA margins from the 3.3% achieved in 2017 to at least 4%. It has also revealed plans to have a much closer cooperation with CMA CGM. Namely, it will purchase the freight management segment of the company, subject to anti-trust approval. CMA CGM has also agreed with the board of CEVA that it will offer to CEVA’s shareholders wishing to exit their investment from the company to purchase their shares for CHF 30.00 per share. 

Source: CEVA