Nir Gilad, CEO of the Israel Corporation, is
to ask the Israeli Finance Ministry to break up subsidiary Zim
Integrated Shipping Services, following further quarterly
losses.
Over the first quarter of 2012 the Corporation
recorded a loss of $82m (€65m), an increase from $57m in the same
period 2011, dragged down by the unprofitable Zim operation, which
Gilad may hope to sell or merge.
Go deeper with GlobalData
$163m was lost by Zim in Q1 2012, an increase
from $111m lost in Q1 2011, with the costs of fuel and
vessel-leasing taking much of the blame. In February, Zim returned
NIS 45m (€9m) to settle a lawsuit regarding investment in the
company by the Israel Corporation.
Costs for leasing ships in the first three
months of 2012 were up $26m compared to a year earlier as Zim
recorded a drop in revenue from over $900m in Q1 2011 to $865m for
the first quarter of 2012.
Under tough conditions for shipping and ship
leasing, which have seen companies such as Global Ship Lease drop
first-quarter revenue and profit year-on-year, Zim recorded a rise
in containers carried, year-on-year, in Q1 but a drop in the
average rate charged.
Rafi Danieli, CEO of Zim, predicted a rise in
shipping rates, together with a decline in global oil prices would
help Zim recover.
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By GlobalDataRates on both the Shanghai-Europe and
trans-Pacific routes were expected to rise, said Danieli, and Zim
has acquired three new vessels to increase capacity.
richard.brown@vrlfinancialnews.com
