Tuesday, May 7, 2013

Logistics Business As Usual Whilst Non Asset Based Freight Group Releases Audited Results

Recapitalisation Sees Reduced Interest Debts as Revenue Increases
Shipping News Feature

WORLDWIDE – Unlike so many of their competitors the Ceva group has been extremely candid when revealing its financial report for 2012. Without resorting to the usual plethora of verbiage which accompanies such news comes a frank and straightforward assessment of the freight forwarding and logistics company’s performance for what for almost the entire shipping industry, has been a difficult period.

With close to 50,000 employees worldwide the target for the group is to buck a depressive trend in the sector and, despite falling returns, the figures do not appear to be too bad considering the factors which have depressed the market for the past year or more, particularly the usual bête noir of exchange rates. Overall revenue increased by 4.8% from €6,895 million in 2011 to €7,224 million in 2012 but total EBITDA fell sharply prompting Ceva CEO Marvin O. Schlanger to comment when the unaudited figures were released last month:

“These are difficult times for everyone in the global logistics industry and Ceva has not been immune to those pressures. While our revenue line has been resilient, we have seen a marked deterioration in EBITDA in both our freight management and contract logistics businesses. This simply isn’t good enough and we have taken action to reverse this decline in profitability. We will continue to take actions necessary to establish satisfactory levels of profitability.”

The non-asset based group has just completed a successful recapitalisation which meant that the newly released figures show a drop in bottom line net debt from €2.774 billion in 2011 to €2.501 billion last year. Last week the company stated that via the recapitalization, Ceva reduced its consolidated net debt by approximately €1.3 billion, reduced its cash interest expense by over €130 million and received cumulative new capital commitments of over €230 million for investment in its ongoing business plan, a move described by Schlanger as ‘a transformational transaction’ which repositioned the company.

The audited report can be seen in full HERE.

Meanwhile it’s business as usual for the group which recently signed a new five year e-commerce contract with Liu-Jo, a leading company in fashion apparel, accessories and footwear. Under the terms of the contract, the company will provide Liu-Jo with solutions for online sales, such as packaging, gift packaging and the management of Liu-Jo returned apparel, bags, shoes and accessories at Ceva’s warehouse located in Cortemaggiore, near Piacenza.

Ceva will also aim to provide highly customised value-added services, such as the personalisation of products on an individual consumer basis whilst also managing transport activities across Europe. Andrea Cappi, E-commerce Director of Liu-Jo, said:

“We chose Ceva to manage our product, packaging, gift packaging, distribution and reverse logistics because we know we can count on them as a strategic partner who will offer us excellent and impeccable solutions. The know how that Ceva has gained at the international level, along with several partnerships sealed with other important e-commerce customers, will be key to support our business objectives, not only in Italy, but also abroad. Our company and Ceva share the same focus on innovation and search for quality, which are fundamental in order to gain competitive advantage.”

Ceva has form in the fashion market handling both flat and hanging garments, accessories and shoes for many leading fashion brands, as well as the transport of different kinds of products purchased online. Giuseppe Chiellino, MD of Ceva in Italy, said:

“Italy now has more than 12 million active online shoppers, so there is a huge demand for expert logistics providers. Our knowledge of the fashion sector and our e-commerce experience give us a competitive edge within our industry. A distinctive element of this contract is the integrated collaboration with Liu-Jo’s marketing department, where we provide customised service to the end consumer. Ceva strives to guarantee the best lead times and offer the right flexibility to support customers in their e-commerce activities.”