ZIM Integrated Stock Gains On Solid Q2 Results, Raised FY21 Outlook

ZIM Integrated Shipping Services Ltd ZIM reported second-quarter revenues of $2.83 billion compared to $795 million in 2Q20, beating the consensus of $1.77 billion.
EPS of $7.38 beat the consensus of $5.22.
ZIM carried 921 thousand TEUs, compared to 641 thousand TEUs in 2Q20.
The average freight rate per TEU was $2,341 versus $1,071 for 2Q20.
The gross margin expanded by 3,840 bps to 51.3% from 12.9% in 2Q20.
The Operating income increased to $1.16 billion from $69 million a year ago.
Adjusted EBITDA increased to $1.34 billion, from $145 million in 2Q20, and margin expanded by 3,800 bps to 56%.
ZIM generated cash from operating activities year-to-date of $1.96 billion, compared to $221 million a year ago. Free cash flow of $1.51 billion.
ZIM's cash and cash equivalents were at $1.55 billion as of June 30, 2021. Net debt decreased to $783 million.
ZIM had also declared a special cash dividend of ~$238 million, or $2.00 per ordinary share, to be paid on September 15, 2021, to holders of the common shares as of August 25, 2021.
It reiterated the plan to distribute an annual dividend of 30-50% of 2021 net income in 2022.
FY21 Outlook: ZIM expects to generate Adjusted EBITDA of $4.8 billion - $5.2 billion (prior $2.5 billion - $2.8 billion) and Adjusted EBIT of $4.0 billion - $4.4 billion (prior $1.85 billion - $2.15 billion).
Price Action: ZIM shares are trading higher by 5.93% at $48.21 during the premarket session on Wednesday.

Overview Rating:

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