CONTAINER liner company Zim has adjusted its full-year outlook for 2023; the company is expecting an EBIT loss of $500 million to $100 million, down from its previous guidance of a positive EBIT of between $100 million and $500 million.
The company also expects to generate an adjusted EBITDA of $1.2 billion to $1.6 billion, down from between $1.8 billion and $2.2 billion.
The company said its updated full-year 2023 guidance is driven primarily by continued low freight rates across all its trades.
Zim said freight rates were particularly wean in the trans-Pacific, which is now expected to continue during the second half of 2023.
Volume growth is also expected to be lower than originally forecast as demand continues to be subdued.
Zim president and CEO Eli Glickman said near-term container shipping market conditions continue to be challenging, with demand expected to remain muted for the remainder of the year.
“While our second quarter results are broadly in line with our expectations, we no longer anticipate an improvement in freight rates in the second half of 2023, consistent with seasonality, as previously assumed,” he said.
“During this downturn, we will continue to actively manage and rationalise our fleet and services to maximise our cash position.
Mr Glickman said the company expects its “strong” balance sheet and “ample” cash to continue serving Zim well and allow it to maintain a “long-term view”.
“As we look to the future, we believe that our cost-effective and fuel-efficient newbuild capacity, particularly our newbuild LNG vessels, will markedly improve our cost structure and competitive position, allowing us to deliver sustainable value for both customers and shareholders over the long term,” he said.