Israel-Based Cargo Shipping Company ZIM's Freight Boom: Q4 Sales Up 80% With 409% EBITDA Growth

by Lekha Gupta Benzinga Editor

ZIM Integrated Shipping Services Ltd ZIM reported a fourth-quarter sales increase of 80% year over year to $2.17 billion, beating the consensus of $2.06 billion.

Revenue was driven by the increase in freight rates as well as carried volume.

The cargo shipping company's carried volume in the quarter was 982 thousand TEUs, up 25% Y/Y. The average freight rate per TEU was $1,886 (+71% Y/Y).

Adjusted EBITDA escalated 409% Y/Y to $967 million, with margins of 45% vs. 16% in the prior year quarter.

The Haifa, Israel-based company generated an EPS of $4.66, vs a loss of $1.23 last year, beating the consensus of $3.49.

Operating cash flow for the year was $3.75 billion, compared to $1.02 billion a year ago. Capital expenditures were $214 million during the quarter versus $116 million a year ago.

ZIM's total cash position increased by $451 million from $2.69 billion as of December 31, 2023, to $3.14 billion as of December 31, 2024.

ZIM's net leverage ratio was 0.8x as of December-end, compared to 2.2x as of December 31, 2023.

Eli Glickman, ZIM President & CEO, said, “The benefits of our fleet transformation were evident throughout 2024 and reflected in our strong financial results, as well as volume growth that far outpaced the overall market.”

”Driving our market share gains was the new capacity deployed on the Asia to U.S. East Coast trade, the successful expedited services to the U.S. West Coast, and our expanded presence in Latin America.”

Dividend: The Board of Directors declared a regular cash dividend of $382 million ($3.17 per share), payable on April 3, 2025, to shareholders of record as of March 24.

2025 Outlook: ZIM expects an adjusted EBITDA of $1.6 billion – $2.2 billion and an adjusted EBIT of $350 million – $950 million.

“We enter 2025 with a more resilient business and modern cost- and fuel-efficient capacity, 40% of which is LNG-fueled. While acknowledging that our industry is highly volatile, exacerbated by current uncertainty related to geopolitics, international political dynamics and economic, fiscal and monetary policies, we are confident in our agile approach and competitive position in the industry,” added Glickman.

Investors can gain exposure to the stock via Tidal Trust II YieldMax Ultra Option Income Strategy ETF ULTY and SonicShares Global Shipping ETF BOAT.

Price Action: ZIM shares are down 4.73% at $19.35 at the last check Wednesday.

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