Zim Integrated Shipping Services Ltd. · NYSE:ZIM
Zim Integrated Shipping Services — Q2 2022 Earnings Presentation
19 slides from Zim Integrated Shipping Services's earnings presentation, Aug 17, 2022
Slide 1: Q2 2022 Financial Results
Q2 2022 FINANCIAL RESULTS August 17, 2022
Slide 2: Disclaimer
Disclaimer | Forward-Looking Statements | | Adjusted EBITDA | This presentation contains or may be deemed to contain forward-looking statements (as defined in the U.S. Private Net income (loss) adjusted to exclude financial expenses (income), net, income Securities Litigation Reform Act of 1995 and
Slide 3: Q2 2022 & 1H 2022 – continued strong financial results and profitability
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Q2 2022 & 1H 2022 – continued strong financial results and profitability YoY Prior period Revenues $7.15 Bn +73% Adjusted EBITDA $4.63 Bn +115% Adjusted EBITDA 1H.2022 and EBIT margins 52% and 45% Net income $3.05 Bn
Slide 4: Increasing dividend quarterly payout
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Increasing dividend quarterly payout Dividend policy* 2022 dividends (effective August 2022) (to date) Distribute 30-50% on annual net income as follows: Q1, Q2, Q3 – interim dividends of Q1 interim dividend – $2.85 30
Slide 5: Execution based on core competencies – innovation, agility, excellence
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Execution based on core competencies – innovation, agility, excellence Global-niche strategy Currently Adapt fleet to Expand car Maintain high Grow & adapt operating 149 new 2M carrier fleet level of fleet network; ves
Slide 6: Investing in growth engines
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Investing in growth engines Data science and AI Next generation Cutting edge, eB/L blockchain to enhance scanning technology power efficient solution operations and tracking system profitability 6
Slide 7: Strong results across key operational and financial indicators
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Strong results across key operational and financial indicators* Operational Q2-22 1H-22 Cash flow Q2-22 1H-22 Balance Sheet 30-6-22 Carried volume 856 1,715 Free cash flow 1,639 3,122 Total debt** 4,567 (K TEUs) (-7%)
Slide 8: Consistent earnings growth and low leverage ratio
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Consistent earnings growth and low leverage ratio $9,075 $8,310 $6,597 $4,767 $2,949 3.4x $1,759 $1,036 $414 $465 $620 0.1x Q1/20 Q2/20 Q3/20 Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Q1/22 Q2/22 LTM Adj. EBITDA ($ Mn) Net Leverag
Slide 9: Significant YoY improvement across all financial indicators; record 1H results
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Significant YoY improvement across all financial indicators; record 1H results +73% XX% - margin +115% +44% +57% 56% 61% 52% 65% Adjusted Revenue 2,382 3,429 4,126 7,145 EBITDA 1,335 2,101 2,156 4,634 ($Mn) ($Mn) +117%
Slide 10: Volume breakdown by geographic trade zone (K TEU)
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Volume breakdown by geographic trade zone (K TEU) 1,739 1,715 97 117 444 543 313 921 856 52 279 61 173 237 274 200 159 125 Latin America 89 712 Intra-Asia 105 576 Atlantic 384 291 Cross-Suez Pacific Q2.2021 Q2.2022 H1.
Slide 11: Total cash position recovered after dividend payments of $2.4 billion
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Total cash position recovered after dividend payments of $2.4 billion -2,379 3,370 -627 59 121 -248 3,122 -54 Cash Flow from CAPEX, Net Free Cash Dividend Debt Service Financing Net Change Net Change in Operations Flow
Slide 12: Reaffirming 2022 full-year guidance; expected record year of earnings and profitability
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Reaffirming 2022 full-year guidance; expected record year of earnings and profitability Adjusted Adjusted EBITDA EBIT $7.8 – 8.2 Bn $6.3 – 6.7 Bn Average freight rates in Volume growth ~2-3% Average bunker rates in Cha
Slide 13: Despite some improvement, port congestion not expected to improve into 2023
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Despite some improvement, port congestion not expected to improve into 2023 Port congestion – North American ports Cargo ready date to destination port Real effective capacity departure 120 110 -7% 100 -17% -15% -11% 9
Slide 14: Demand trends remain positive despite macro headwinds
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Demand trends remain positive despite macro headwinds Global demand in 1H 2022 – 5.4% higher than 2019 Demand (Avg Weekly TEU) vs. US Retail Trade Global volumes, TEU/month Inventory/Sales Ratio 269K 217K 1.12 FE-USWC
Slide 15: New dynamics impacting supply/demand balance
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary New dynamics impacting supply/demand balance Expected delivery of newbuild capacity (TEU/quarter) 3% 9% 11% 5% Traditional view Actual newbuild deliveries vs. economic growth 843K 646K 692K 680K 690K New dynamics 627K
Slide 16: Differentiated commercial strategy and competitive cost structure
Q2 2022 highlights Financial highlights 2022 guidance Market developments Summary Differentiated commercial Well positioned as strategy and competitive innovative digital cost structure with leader of seaborne chartered newbuild capacity transportation Commitment to Set to deliver record results Out
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Slide 19: Reconciliation of net income to Adjusted EBITDA and Adjusted EBIT
Reconciliation of net income to Adjusted EBITDA and Adjusted EBIT ($ in Mn) Q2’22 Q2’21 Q2’20 RECONCILIATION OF NET INCOME TO ADJUSTED EBIT Net income 1,336 888 25 Financial expenses, net 28 45 40 Income taxes 400 224 4 Operating income (EBIT) 1,764 1,157 69 Non-cash charter hire expenses (1)(2) 0 1
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