Shares of Zim Integrated Shipping hit an all-time low as the company reported a significant loss in the third quarter due to a $2.1 billion impairment charge. The stock plunged 13% to a record low of $6.77 during early trading, marking a 60% decline since the beginning of the year.
Heavy Losses and Disappointing Revenue
Zim Integrated Shipping, a container liner shipping company, posted a loss of $2.27 billion, equivalent to $18.90 per share. In comparison, the company had reported a profit of $1.17 billion, or $9.66 per share, during the same quarter last year. This loss was more substantial than analysts’ expectations of $1.73 per share.
Furthermore, revenue dropped to $1.27 billion from $3.23 billion in the previous year’s quarter. Unfortunately, this also missed analyst projections for $1.29 billion in revenue.
CEO’s Remarks Reflect Challenging Market Conditions
Chief Executive Eli Glickman acknowledged that weak demand and declining freight rates heavily impacted the company’s performance during the quarter. As a result, Zim Integrated Shipping recorded a noncash impairment loss of $2.1 billion based on its freight rate outlook. Adjusted earnings before interest, taxes, depreciation, and amortization for the entire year are now expected to be lower.