CSAV Reports Net Income of US$ 66.9 Million for First Half of 2020
Despite the significant drop in global shipping volumes as a result of the coronavirus pandemic, Hapag-Lloyd, the German shipping line in which CSAV has a 30% stake, performed well during the first half of the year.
Santiago, August 21, 2020. Compañía Sud Americana de Vapores (CSAV) reported net income of US$ 66.9 million for the first half of 2020, thanks to earnings from its container shipping business, in which CSAV participates through its investment in Hapag-Lloyd.
Hapag-Lloyd, the German shipping line in which CSAV has a 30% interest and is one of its main shareholders, closed the first half of the year with net income of US$ 314 million, surpassing by 90.3% (+US$ 149 million) the figure reported for the same period last year. It also reported EBITDA of US$ 1,287 million and EBIT of US$ 563 million, representing improvements of 19% (+US$ 207 million) and 28% (+US$ 123 million), respectively, in comparison to the first half of 2019.
“COVID-19 has presented a major challenge for the shipping industry. Up until now, the company and the industry in general have dealt with it well. This is a sign of a more mature industry, as a result of consolidation, than the one we saw during the 2009 financial crisis. The challenges for the second half of the year continue to be sizable. However, we are seeing some degree of recovery in cargo volumes,” explained Óscar Hasbún, CSAV’s CEO.
Despite the strong contraction in demand during the second quarter of 2020, due to mobility restrictions mainly affecting volumes along trades between Asia, Europe and the United States, Hapag Lloyd took appropriate measures to deal with the contraction. The shipping line made important changes to its service network, including significant reductions in capacity to keep usage rates up within its network. Furthermore, its diverse initiatives to lessen the effect of falling volumes combined with a solid freight rate drove a strong financial performance during the first half of the year.
CSAV is also in the midst of a capital increase designed to reduce its short-term debt taken out to purchase additional interests in Hapag-Lloyd last January to attain 30% ownership.
The Company announced this Tuesday that the share price for the US$ 350 million capital increase, approved at an extraordinary shareholders’ meeting in May of this year, had been set at US$ 0.0241 per share. This involves placing 14,523,000,000 new shares, for which the Preferential Option Period will begin on August 27th.