French ocean carrier CMA CGM swung to a first half net profit of $864 million from a year earlier loss of $518 million on higher traffic volume and freight rates combined with lower costs.
The Marseilles-based carrier boosted revenue by 41 percent to $6.77 billion in the six months to June 30 from $4.8 billion in the same period in 2009.
Cargo volume jumped nearly 22 percent to 4.4 million 20-foot equivalent units from 3.6 million TEUs a year ago.
By The Numbers: Container Rate Benchmark.
"The recovery in business that began to emerge in late 2009, gained further momentum during the first six months of 2010," the world's third largest ocean carrier said.
CMA CGM earned $1.05 billion before interest, taxes, depreciation and amortization compared with a year-earlier loss of $568 million.
The carrier, which is negotiating a capital injection with several investors, said it expects its second quarter performance to continue through the third quarter and year-end trends remain positive.
The carrier said its lower cost base resulted in one of the shipping industry's highest operating margins at 15.5 percent of revenue for the first half and 18.8 percent for the second quarter.
This compares with a negative margin of 11.9 percent in the first half of 2009.
"These results reflect the group's strategic decisions to invest in large container ships and to deploy a cost-reduction plan," the carrier said in a statement.
"Other contributing factors were the upturn in the global economy, which drove an increase in both volumes carried and freight rates, and the commitment of all the group's teams."
The company said it has kept pace with the growth in freight volume by continuing to expand its fleet.
"Nevertheless, competition remains sustained in a still uneven global economy," it cautioned.
CMA CGM said it will continue to reduce costs in the second half “in order to optimize its business model and consolidate its growth on reinforced financial bases.”
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