Zim Loss Grows to $208 Million

Zim Integrated Shipping Services, suffering a steep drop in demand in its container shipping business, reported a $208 million loss in the third quarter on Thursday, more than triple the loss from last year.

Revenue plunged 50 percent to $596 million from $1.2 billion a year earlier on lower container volume and weaker freight rates.

The loss was deeper than the $186 million the carrier lost in the previous quarter and left the Israeli carrier with an accumulated $513 million for the year, a big contribution toward the $20 billion loss industry experts project for containership operators this year.

Zim’s loss helped push parent Israel Corp. into an $11 million third quarter net loss from a year-earlier profit of $253 million.

Israel Corp. shareholders narrowly voted earlier this month for a $450 million capital injection for Zim as well as a $100 million “safety net” as part of a recovery plan for the world’s 17th-largest carrier.

The troubled carrier, which faces a cash flow deficit of $1 billion over the next four years, also will receive more than $500 million in new financing from its banks in 2009-10 to finance the purchase of ships repayable over more than 10 years.

Zim has cut charter payments to ship owners, returned leased ships, trimmed its work force, closed unprofitable services, joined forces with rivals on some routes, and delayed deliveries of new ships as part of the recovery program.