2021 Annual Financial Results: Acceleration of the Group’s strategic investments in a context of excellent financial performance

The Board of Directors of the CMA CGM Group, a world leader in shipping and logistics, met today under the chairmanship of Rodolphe Saadé, Chairman and Chief Executive Officer, to review the consolidated financial statements for 2021.  

Upon the release of the results for 2021, Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, commented:  

“Driven by extremely strong demand conditions, we recorded excellent results in 2021. During this period, we have invested massively in our industrial assets (fleet of vessels, containers and aircraft, terminals and warehouses) to support our customers in their logistics challenges. We have accelerated the development of our Group through strategic acquisitions. Our teams have remained mobilized and demonstrated an exceptional ability to adapt.  

In a context of persistent tensions on global logistics chains, which have been particularly challenging for SMEs, we have decided to allocate dedicated capacity on board our vessels to these SMEs in the markets where tensions are highest (Europe, North America) at a negotiated rate, usually only available with much larger volume commitments.

In 2022, we will continue our transformation around our two pillars, transport and logistics, and accelerate our energy transition.

We are of course continuing to monitor the situation in Ukraine very closely. We are mobilizing to ensure the safety of our staff members on site and we are making our air capacity available to transport emergency humanitarian supplies to Poland, in coordination with the French authorities.” 

Acceleration the investments to develop an end-to-end logistics offering  

2021 continued to be impacted by the COVID-19 pandemic, and saw the emergence of severe pressure on global supply chains.  

To meet these challenges as well as its customers’ expectations, the Group implemented a number of actions aimed at improving the quality of its service, including expanding its vessel and container fleets. The Group pursues its commitment to its customers and has decided to allocate a dedicated capacity on board its vessels to its SME clients in the markets where tensions are highest (Europe, North America) at a negotiated rate, usually only available with much larger volume commitments.

Investments

• To support its strategic development, the Group allocated USD 10 billion in 2021 to expand its owned and leased asset base.
• These investments will continue and be bolstered in 2022 at around USD 14 billion, including the acquisitions of Fenix Marine Services terminal, Ingram CLS and Colis Privé.  

Shipping: significant expansion of the logistics and global infrastructure networks in a context of severe strain on supply chains

Shipping capacity

• 5.8% increase in shipping capacity between January and December 2021, with almost 175,000 TEUs of capacity added;
• 47 owned vessels—including 10 with a capacity of more than 15,000 TEUs—have joined the fleet;
• An additional 800,000 containers over 15 months, for a total of 4.8 million units.
    

Operational and commercial initiatives 

• Los Angeles/Long Beach Port area: Early Container Pickup Incentive Program to encourage prompt collection of containers during extended hours, including on weekends, to accelerate the relief of port congestion;
• Increase in weekly capacities allocated to France and deployment of three additional vessels (30,000 TEUs) dedicated to serving the ports of Marseille-Fos, Le Havre and Dunkirk between December 2021 and February 2022 to support French business activity;
• A new freeze on spot freight rates until June 30th, 2022. CMA CGM was the first shipping company to implement this initiative.
   

Investments in port terminals

The Group has investments in more than 50 port terminals in 33 countries. In 2021, CMA CGM expanded its investments in leading infrastructure to support the growth of its shipping lines and improve the quality of service offered to its customers.

In addition to entering the capital of Total Terminal International Algeciras (TTIA) in Spain, several projects have been initiated: acquisition of FMS (U.S.), Khalifa port’s future container terminal (Abu Dhabi), Alexandria’s new container and general cargo terminal (Egypt).

CMA CGM will further expand its port activities in 2022: in addition to finalizing the acquisition of the FMS terminal on January 4, CMA CGM will manage, operate and maintain Beirut port’s container terminal for 10 years.
 

Equity investments

• Brittany Ferries: 25 million euros invested to support the company’s recovery. This agreement also provides the opportunity to offer a “fast lane” shipping solution with increased departure frequencies and serve British port terminals not impacted by congestion. 

Logistics: continuing CEVA’s transformation and expanding its e-commerce offering  

The acquisition of CEVA Logistics in 2019 marked the Group’s strategic move into logistics.  

In 2021, CEVA Logistics strengthened its end-to-end e-commerce offering for retail and industrial customers.

• Ingram Micro’s Commerce & Lifecycle Services business activity, which will provide a complete solution for warehousing, inventory management, shipping and returns for e-retailers. The acquired business represents estimated annual revenues of USD 1.7 billion in 2021 and employs 11,500 people across the globe in 59 warehouses, with a strong presence in the United States and Europe. 
• Colis Privé: the takeover of Colis Privé2, a specialist in home package delivery and relay points in France, Belgium, Luxembourg and Morocco, will round out the e-commerce logistics offering by providing “last mile” delivery solutions to end customers.  

Air freight: a complement to the Group’s business activities 

Launched in February 2021, CMA CGM AIR CARGO marks a new phase in the strategic move to provide the Group’s customers a complete offering that combines of shipping and logistics services.  

The Group has invested in a fleet that will include at least 10 aircraft by 2026

Acquisitions

• Four Airbus A330-200F aircraft, currently in operation;
• Two new Boeing 777F aircraft, to be delivered in spring 2022;
• Four new Airbus A350F aircraft scheduled to enter the fleet between 2025 and 2026.  
   

The Group has decided to make CMA CGM AIR CARGO a French freight airline.  

• As such, CMA CGM AIR CARGO has filed an application for an Air Operator Certificate with the French Civil Aviation Authority (DGAC — Direction générale de l’aviation civile française).
• The recruitment of around 100 B777F and A330F pilots has already begun. 

A Group committed to sustainable growth 

In 2021, the Group has expanded even more its social, societal and environmental actions even further. 

Supporting its employees and talents  

Training

• More than 420,000 hours of training provided within the CMA CGM Academy.
• Creation of TANGRAM, a center of training excellence and innovation launched by the Group in Marseille, to develop the sustainable shipping and logistics solutions of tomorrow. It will welcome up to 300 people a day, including 90 trainees.  
   

Social support

• USD 5 million allocated to the CMA CGM We Care Fund, a fund designed to support Group employees facing difficulties. The creation of this fund follows the Group’s actions undertaken in 2020 to support employees affected by the COVID-19 pandemic.

Acting for the planet today 

The CMA CGM Group is committed to achieving Net Zero Carbon by 2050 and intends to accelerate the energy transition for transport and logistics.  

Investments

• USD 5.4 billion already committed for an “e-methane ready” fleet of 44 vessels by the end of 2024, currently powered by liquefied natural gas, including 26 vessels already in  service.
• Support for the production of 25,000 tons of biomethane. 
   

Customer offer

• Expansion of ACT with CMA CGM+, a commercial offering which enables Group customers to analyze, reduce and offset their CO₂ emissions in order to reduce their environmental footprint. 
   

Operational initiatives

• Support to the development of synthetic methane production infrastructure including e-methane, through a partnership with ENGIE
• First French port project to produce biomethane in Marseille-Fos.
• Ban of plastic waste transport on the Group’s vessels: a pioneering decision announced by Rodolphe Saadé at the One Ocean Summit.  
• Extension of the Reef Recovery Program in Malaysia and the Philippines, following the initiatives in Australia and the Seychelles, to protect and restore coral reefs.
• 82 operations allowing the collection of more than six tons of waste as part of World Cleanup Day.  
   

Partnerships

• WWF France: a unique partnership to promote the decarbonization of shipping and logistics, the fight against the illegal trade of endangered wildlife and the preservation and conservation of marine ecosystems.
• Coalition for the Energy of the Future: welcoming six new international companies. Today, 17 major global corporates have committed to developing the energies of the future for shipping and logistics as part of this initiative initiated by Rodolphe Saadé in 2019.

A Group that supports education and responds to global crises

The CMA CGM Foundation helps thousands of children every year as part of its action to support education for all and equal opportunities. It also provides solutions to humanitarian crises requiring emergency response by mobilizing the Group’s shipping and logistics expertise to transport humanitarian equipment in partnership with the largest NGOs (MSF, Red Cross, ACF) and UN organizations (UNICEF).

In 2021, the CMA CGM Foundation scaled up its initiative

• Creation of Le Phare, a social incubator that provides support to young entrepreneurs developing projects with strong social impacts. Le Phare was inaugurated in Marseilles in September 2021 with a first class of seven entrepreneurs.
• 545 TEUs transported to 23 destinations as part of Containers of Hope, the Foundation’s humanitarian transport project, mainly to Chad, Lebanon and Yemen. A special humanitarian operation to India was also conducted through the use of the Group’s air freight capacities.
• Skills-based sponsorship program: over 100 employees involved in France and Lebanon. 
   

Regarding the current situation in Ukraine and the Black Sea region, le CMA CGM Group, through its Foundation, and in coordination with the French authorities, has decided to mobilize its air freight capacities to transport to Poland urgent humanitarian material to help Ukrainian refugees. 

Group: solid financial performance and strengthening of financial structure  

In 2021, revenue amounted to USD 56 billion, up 78% compared to 2020, driven mainly by the Group’s shipping activities.

EBITDA came in at USD 23.1 billion, representing an EBITDA margin of 41.3% (a 21.8-point increase compared with 2020).  

Net income, Group share, was USD 17.9 billion. The Group has decided to reinvest 90% of the net income into the Group’s continued development, the energy transition and its employees.

The Group continued to strengthen its financial structure. Net debt amounted to USD 7.7 billion as of December 31, 2021, down USD 9.2 billion year-on-year, mostly driven by a high level of free cash flow generation on the back of the Group’s strong operational performance.

Shipping activity: Strong increase in revenue 

In 2021, volumes carried amounted to 22 million TEUs, up 5% compared with 2020 which was negatively impacted by the COVID-19 pandemic. This increase reflects a dynamic start to the year followed by a second half where volumes were constrained by the lengthening of transit times, due to port and inland infrastructure congestions in certain parts of the world.  

2021 shipping revenue was up 88.5% compared with 2020 and reached USD 45.3 billion.

EBITDA stood at USD 22.1 billion, compared with USD 5.3 billion in 2020. EBITDA margin increased by 26.5 points to 48.7%, driven by average revenue per TEU over the year of USD 2,055 in a context also marked by a sharp rise in operating costs: unit costs in the fourth quarter were up by almost 30% compared to the same period of 2020, due in part to higher energy, handling and chartering costs.

Logistics: improved financial performance 

Logistics revenue grew strongly throughout the year to USD 10.9 billion, up 46.9%. This growth was driven in particular by shipping and air freight activities, as well as the continued recovery of the contract logistics business. CEVA Logistics pursued its turnaround in line with its transformation plan.  

EBITDA reached USD 882 million, representing a 43.6% increase over 2020.

See CMA CGM Group key figures

Healthy global trade since the onset of 2022, but with geopolitical uncertainties 

Tensions in global supply chains have continued to weigh on the effective capacity of the global fleet since the start of 2022, and on the Group's operations. As a result, the Group has further increased its fleet capacity, and plans to allocate nearly USD 9 billion to enhancing its portfolio of assets (including owned and chartered containers and vessels, excluding acquisitions). Following the acquisition of Fenix Marine Services on January 4, the Group expects to close the Ingram CLS and Colis Privé transactions by the summer of 2022 in order to strengthen its logistics solutions, particularly in the of e-commerce space.

Moreover, the Group is closely monitoring developments in the current geopolitical landscape and has taken the decision to suspend all bookings to/from Russia, Ukraine and Belarus. The Group also ensures that it complies with applicable sanctions. Energy prices have been impacted by the geopolitical events.  

Although the decisions taken thus far have no material impact on the Group's performance, it is difficult to assess yet the impact of a further deterioration in the geopolitical environment the potential macro-economic consequences and the implications of the measures that may have to be taken by the Group.