6-K
ZIM Integrated Shipping Services Ltd. (ZIM)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATEISSUER
PURSUANT TO RULE 13a-16OR 15d-16 OF THE
SECURITIES EXCHANGE ACTOF 1934
For the month of May, 2021
Commission File Number: 001-39937
ZIM Integrated Shipping Services Ltd.
(Exact Name of Registrant as Specified in ItsCharter)
9 Andrei Sakharov Street
P.O. Box 15067
Matam, Haifa 3190500, Israel
+972 (4) 865-2000
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
| Form 20-F | x | Form 40-F | ¨ |
|---|
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
| Yes | ¨ | No | x |
|---|
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
| Yes | ¨ | No | x |
|---|
On May 19, 2021, ZIM Integrated Shipping Services Ltd. (the “Company”) issued a press release announcing its consolidated results for the three months ended on March 31, 2021. A copy of this press release and the Company’s consolidated financial statements for the period ended on March 31, 2021 are attached herewith as Exhibit 99.1 and Exhibit 99.2, respectively.
The information in this Form 6-K (including Exhibit 99.1 and Exhibit 99.2) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| ZIM INTEGRATED SHIPPING SERVICES LTD. | |
|---|---|
| By: | /s/ Noam Nativ |
| Noam Nativ | |
| EVP General Counsel and Corporate Secretary |
Date: May 19, 2021
EXHIBIT INDEX
| EXHIBIT NO. | DESCRIPTION |
|---|---|
| 99.1 | Press Release dated May 19, 2021 |
| 99.2 | Consolidated financial statements for the three month period ended on March 31, 2021 |
Exhibit 99.1
ZIM Reports Financial Resultsfor the First Quarter of 2021
Generates Record QuarterlyNet Income of $590 Million andAdjusted EBITDA of $821 Million
Increases 2021 Guidanceto Between $2.5 Billion and $2.8 Billion of Adjusted EBITDA and Between $1.85 Billion to $2.15 Billion of Adjusted EBIT
Announces Special Dividendof Approximately $238 Million, or $2.00 Per Share, on Top of 2021 Annual Dividend
Haifa, Israel, May 19, 2021 – ZIM Integrated Shipping Services Ltd. (NYSE: ZIM), a global container liner shipping company, announced today its consolidated results for the three months ended March 31, 2021.
First Quarter 2021 Highlights
| · | Net<br> income for the first quarter was $589.6 million (compared to a loss of $11.9 million in the<br> first quarter of 2020), or $5.35 per share^1^ |
|---|---|
| · | Adjusted<br> EBITDA^2^ for the first quarter was $820.5<br> million, a year-over-year increase of 744% |
| --- | --- |
| · | Operating<br> income (EBIT) for the first quarter was $683.5 million, a year-over-year increase of 2,645% |
| --- | --- |
| · | Adjusted<br> EBIT for the first quarter was $687.8 million, a year-over-year increase of 2,430% |
| --- | --- |
^1^ Earnings per share calculation for all periods reflect a share split of 1:10 that became effective in 2021.
^2^ See disclosure regarding “Use of Non-IFRS Financial Measures” below.
| · | Revenues<br> for the first quarter were $1.74 billion, a year-over-year increase of 112% |
|---|---|
| · | ZIM<br> carried 818 thousand TEUs in the first quarter of 2021, a year-over-year increase of 28% |
| --- | --- |
| · | The<br> average freight rate per TEU in the first quarter of 2021 was $1,925, a year-over-year increase<br> of 76% |
| --- | --- |
| · | Net<br> leverage ratio^3^ of 0.5x at March 31, 2021,<br> compared to 1.2x at December 31, 2020 |
| --- | --- |
| · | Completed<br> IPO, raising $204 million in net proceeds |
| --- | --- |
| · | Announced strategic long-term chartering<br> agreement with Seaspan for ten "green" LNG-fueled vessels demonstrating ZIM's commitment to reducing its carbon footprint<br> and leading environmentally friendly practices in the shipping industry |
| --- | --- |
| · | Subsequent<br> to quarter end, announced full early redemption of $349 million principal amount of Series<br> 1 and 2 Notes due 2023 payable in June 2021 |
| --- | --- |
| · | Declared<br> a special cash dividend of approximately $238 million, or $2.00 per ordinary share, to be<br> paid on September 15, 2021, to holders of the ordinary shares as of August 25, 2021;<br> reiterated plan to distribute annual dividend of 30-50% of 2021 net income in 2022 |
| --- | --- |
Eli Glickman, ZIM President & CEO, stated, “This is truly a momentous time in ZIM’s 75-year history. Following our successful IPO to become the first global container liner to list in the U.S., we are proud of our demonstrated accomplishments based on seamless execution aligned with our stated objectives. Driven by ZIM’s differentiated approach and proactive strategies, we generated our highest ever quarterly net profit, EBITDA, and cash flow, while continuing to deliver industry leading margins. We also significantly strengthened our balance sheet, with shareholder equity now in excess of $1 billion. In a short time since going public, we have also achieved important milestones for shareholders. Specifically, we significantly strengthened our position in the growing and strategic Pacific and Intra Asia trades, with our long-term chartering agreement for large LNG dual-fuel container vessels and the launch of new services to address unmet need in profitable routes to generate superior growth. We also drew on our strong cash flow to redeem ZIM’s $349 million outstanding Series 1 and 2 Notes sooner than expected and earlier than the stated maturity by two years.”
^3^ Net leverage ratio is defined as face value of short- and long-term debt less cash, cash equivalents and short-term deposits divided by Adjusted EBITDA of the last twelve-month period.
Mr. Glickman added, “Based on our success further strengthening our balance sheet, we are pleased to allocate capital to invest in new equipment to continue to best serve customers while returning capital to shareholders. With today’s declaration of a special dividend, we will be distributing approximately $238 million, or $2.00 per share, in line with our commitment to unlock significant value. Importantly, this dividend is over and above our 2021 annual dividend guidance, supplementing the 30-50% of 2021 net income we expect to distribute in 2022.”
Mr. Glickman concluded, “As a result of our outstanding execution and the full completion of freight contracts at higher rates, we have substantially raised our full year outlook, with 2021 Adjusted EBITDA now expected to be between $2.5 billion and $2.8 billion, more than 75% higher than the midpoint of our previous guidance range. Going forward, we remain poised to continue leveraging our agility to maximize profitability and advance ZIM’s position as an innovative digital leader of seaborne transportation and logistics services with attractive growth engines.”
Summary of Key Financial and Operational Results(Q1’21 vs. Q1’20 unless otherwise noted)
| Q1’20 | ||||
|---|---|---|---|---|
| Carried volume (K-TEUs) | 818 | 638 | ||
| Average freight rate (/TEU) | 1,925 | 1,091 | ||
| Revenue ( in millions) | 1,744 | 823 | ||
| Operating income (EBIT) ( in millions) | 683 | 25 | ||
| Profit (loss) before income taxes ( in millions) | 644 | (9 | ) | |
| Net income (loss) ( in millions) | 590 | (12 | ) | |
| Adjusted EBITDA ( in millions) | 821 | 97 | ||
| Adjusted EBIT ( in millions) | 688 | 27 | ||
| Adjusted EBITDA margin (%) | 47 | 12 | ||
| Adjusted EBIT margin (%) | 39 | 3 | ||
| Net cash generated from operating activities ( in millions) | 777 | 102 | ||
| Earnings (loss) per share (fully diluted) () | 5.13 | (0.14 | ) | |
| Free cash flow ( in millions) | 643 | 98 | ||
| Net debt ( in millions) (Q1’21 vs. Q4’20) | 915 | 1,236 |
All values are in US Dollars.
Financial and Operating Resultsfor the First Quarter Ended March 31, 2021
Total revenues were $1.74 billion for the first quarter of 2021, compared to $823.2 million for the first quarter of 2020, primarily driven by an increase in revenues from containerized cargo, reflecting increases in both freight rates and carried volume.
Operating income (EBIT) for the first quarter of 2021 was $683.5 million, compared to $24.9 million for the first quarter of 2020.
Net income for the first quarter of 2021 was $589.6 million, compared to a net loss of $11.9 million for the first quarter of 2020.
Adjusted EBITDA was $820.5 million for the first quarter of 2021, compared to $97.2 million for the first quarter of 2020. Adjusted EBIT was $687.8 million for the first quarter of 2021, compared to $27.2 million for the first quarter of 2020. Adjusted EBITDA and Adjusted EBIT margins for the first quarter of 2021 were 47% and 39%, respectively. This compares to 12% and 3% for the first quarter of 2020, respectively.
Net cash generated from operating activities was $777.4 million for the first quarter of 2021, compared to $101.6 million for the first quarter of 2020.
ZIM carried 818 thousand TEUs for the first quarter of 2021, compared to 638 thousand TEUs in the first quarter of 2020. The average freight rate per TEU was $1,925 for the first quarter of 2021, compared to $1,091 for the first quarter of 2020.
Liquidity and Cash Flows
ZIM’s cash and cash equivalents increased by $618 million from $570 million at December 31, 2020 to $1.19 billion at March 31, 2021. Capital expenditures totaled $133.0 million for the first quarter of 2021, compared to $3.6 million for the first quarter of 2020. Net debt decreased by $321 million from $1.24 billion as of December 31, 2020 to $915 million as of March 31, 2021. ZIM’s net leverage ratio as of March 31, 2021 was 0.5x, compared to 1.2x as of December 31, 2020.
Early Redemption of Notes
In April 2021, the Company announced the early redemption of 100% of its Series 1 and 100% of its Series 2 unsecured notes due 2023 at an aggregate principal amount of $349 million, payable on June 21, 2021, in accordance with the terms of the indenture governing the notes.
Long-Term Chartering Agreement
In February 2021, the Company announced a strategic agreement for the long-term charter of ten 15,000 TEU liquefied natural gas (LNG) dual-fuel container vessels to serve ZIM's Asia - US East Coast trade.
Special Dividend
On May 19, 2021, the Company’s Board of Directors declared a special cash dividend of approximately $238 million, or $2.00 per ordinary share. The special cash dividend will be paid on September 15, 2021, to all holders of record of ordinary shares as of August 25, 2021. The special dividend is supplemental to ZIM’s previously communicated 2021 annual dividend guidance, whereby the Company expects to distribute 30-50% of 2021 net income in 2022, subject to Board approval.
Updated Full-Year 2021 Guidance
The Company increased its full-year guidance and expects to generate in 2021 Adjusted EBITDA of between $2.5 billion and $2.8 billion and Adjusted EBIT of between $1.85 billion to $2.15 billion.
Use of Non-IFRS Measures inthe Company’s 2021 Guidance
A reconciliation of the Company’s non-IFRS financial measures included in its full-year 2021 guidance to corresponding IFRS measures is not available on a forward-looking basis. In particular, the Company has not reconciled its Adjusted EBITDA and Adjusted EBIT because the various reconciling items between such non-IFRS financial measures and such corresponding IFRS measures cannot be determined without unreasonable effort due to the uncertainty regarding, and the potential variability of, the future costs and expenses for which the Company adjusts, the effect of which may be significant, and all of which are difficult to predict and are subject to frequent change.
Conference Call Details
Management will host a conference call and webcast (along with a slide presentation) to review the results and provide a corporate update today at 8:00 AM ET.
To access the live conference call by telephone, please dial the following numbers: United States +1-855-265-6958 or +1-718-705-8796; Israel +972-3-721-9662; or UK/international +44-121-281-8004. The call (and slide presentation) will be available via live webcast through ZIM’s website, located at the following link. Following the conclusion of the call, a replay of the conference call will be available on the Company's website.
About ZIM
ZIM Integrated Shipping Services Ltd. (NYSE: ZIM) is a global, asset-light container liner shipping company with leadership positions in the markets where it operates. Founded in Israel in 1945, ZIM is one of the oldest shipping liners, with over 75 years of experience, providing customers with innovative seaborne transportation and logistics services with a reputation for industry leading transit times, schedule reliability and service excellence. For additional information, please visit www.zim.com.
Forward-Looking Statements
This press release contains, or may be deemed to contain forward-looking statements (as defined in the U.S. Private Securities Litigation Reform Act of 1995 and the Israeli Securities Law, 1968). In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about the Company, may include projections of the Company’s future financial results, its anticipated growth strategies and anticipated trends in its business. These statements are only predictions based on the Company’s current expectations and projections about future events or results. There are important factors that could cause the Company’s actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause such differences include, but are not limited to: market changes in freight, bunker, charter and other rates or prices, new legislation or regulation affecting the Company’s operations, new competition and changes in the competitive environment, the outcome of legal proceedings to which the Company is a party, and other risks and uncertainties detailed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission, including under the caption “Risk Factors” in its 2020 Annual Report.
Although the Company believes the expectations reflected in the forward-looking statements contained herein are reasonable, it cannot guarantee future results, level of activity, performance or achievements. Moreover, neither the Company nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. The Company assumes no duty to update any of these forward-looking statements after the date hereof to conform its prior statements to actual results or revised expectations, except as otherwise required by law.
The Company prepares its financial statements in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB).
Use of Non-IFRS FinancialMeasures
The Company presents non-IFRS measures as additional performance measures as the Company believes that it enables the comparison of operating performance between periods on a consistent basis. These measures should not be considered in isolation, or as a substitute for operating income, any other performance measures, or cash flow data, which were prepared in accordance with Generally Accepted Accounting Principles as measures of profitability or liquidity. Please note that Adjusted EBITDA does not take into account debt service requirements, or other commitments, including capital expenditures, and therefore, does not necessarily indicate the amounts that may be available for the Company’s use. In addition, Non-IFRS financial measures, as those presented by the Company, may not be comparable to similarly titled measures reported by other companies, due to differences in the way these measures are calculated.
Adjusted EBITDA is a non-IFRS financial measure which we define as net income (loss) adjusted to exclude financial expenses (income), net, income taxes, depreciation and amortization in order to reach EBITDA, and further adjusted to exclude impairment of assets, non-cash charter hire expenses, capital gains (losses) beyond the ordinary course of business and expenses related to legal contingencies.
Adjusted EBIT is a non-IFRS financial measure which we define as net income (loss) adjusted to exclude financial expenses (income), net and income taxes, in order to reach our results from operating activities, or EBIT, and further adjusted to exclude non-cash charter hire expenses, impairment of assets, capital gains (losses) beyond the ordinary course of business and expenses related to legal contingencies.
Free cash flow is a non-IFRS measure which we define as net cash generated from operating activities plus the net cash generated (used) from investment activities.
See the reconciliation of net income to Adjusted EBITDA and Adjusted EBIT and net cash generated from operating activities to free cash flow under "Reconciliation of Non-IFRS Measures" below.
Investor Relations:
Elana Holzman
ZIM Integrated Shipping Services Ltd.
+972-4-865-2300
holzman.elana@zim.com
Leon Berman
The IGB Group
212-477-8438
lberman@igbir.com
Media:
Avner Shats
ZIM Integrated Shipping Services Ltd.
+972-4-865-2520
shats.avner@zim.com
CONSOLIDATEDBALANCE SHEET
(U.S.dollars in thousands)
| Three Months ended<br> March 31, | Year ended<br> December 31, | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2020 | |||||||
| Assets | |||||||||
| Vessels | 1,299,718 | 737,047 | 948,004 | ||||||
| Containers and handling equipment | 665,636 | 437,639 | 520,887 | ||||||
| Other tangible assets | 64,466 | 67,877 | 67,133 | ||||||
| Intangible assets | 66,808 | 65,716 | 66,465 | ||||||
| Investments in associates | 13,544 | 9,171 | 8,441 | ||||||
| Other investments | 3,147 | 2,717 | 4,888 | ||||||
| Trade and other receivables | 5,647 | 5,390 | 5,293 | ||||||
| Deferred tax assets | 1,619 | 1,018 | 1,502 | ||||||
| Total non-current assets | 2,120,585 | 1,326,575 | 1,622,613 | ||||||
| Assets classified as held for sale | 10,564 | ||||||||
| Inventories | 86,256 | 56,699 | 52,237 | ||||||
| Trade and other receivables | 700,385 | 306,557 | 520,001 | ||||||
| Other investments | 63,015 | 59,510 | 58,976 | ||||||
| Cash and cash equivalents | 1,188,408 | 196,741 | 570,414 | ||||||
| Total current assets | 2,038,064 | 630,071 | 1,201,628 | ||||||
| Total assets | 4,158,649 | 1,956,646 | 2,824,241 | ||||||
| Equity | |||||||||
| Share capital and reserves | 1,992,378 | 1,783,479 | 1,790,794 | ||||||
| Accumulated deficit | (936,101 | ) | (2,053,010 | ) | (1,523,528 | ) | |||
| Equity attributable to owners of the Company | 1,056,277 | (269,531 | ) | 267,266 | |||||
| Non-controlling interests | 3,841 | 4,327 | 7,189 | ||||||
| Total equity | 1,060,118 | (265,204 | ) | 274,455 | |||||
| Liabilities | |||||||||
| Lease liabilities | 1,055,126 | 659,649 | 811,840 | ||||||
| Loans and other liabilities | 440,196 | 550,265 | 519,471 | ||||||
| Employee benefits | 63,198 | 58,252 | 66,626 | ||||||
| Deferred tax liabilities | 34,159 | 347 | 339 | ||||||
| Total non-current liabilities | 1,592,679 | 1,268,513 | 1,398,276 | ||||||
| Trade and other payables | 538,717 | 431,223 | 398,876 | ||||||
| Provisions | 25,631 | 16,081 | 21,420 | ||||||
| Contract liabilities | 295,653 | 125,109 | 230,469 | ||||||
| Lease liabilities | 508,154 | 236,835 | 362,176 | ||||||
| Loans and other liabilities | 137,697 | 144,089 | 138,569 | ||||||
| Total current liabilities | 1,505,852 | 953,337 | 1,151,510 | ||||||
| Total liabilities | 3,098,531 | 2,221,850 | 2,549,786 | ||||||
| Total equity and liabilities | 4,158,649 | 1,956,646 | 2,824,241 |
CONSOLIDATEDINCOME STATEMENTS
(U.S.dollars in thousands, except per share data)
| Year ended<br> December 31, | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2020 | 2020 | |||||||
| Income from voyages and related services | 1,744,335 | 823,215 | 3,991,696 | |||||
| Cost of voyages and related services | ||||||||
| Operating expenses and cost of services | (880,627 | ) | (698,388 | ) | (2,835,112 | ) | ||
| Depreciation | (128,129 | ) | (67,063 | ) | (291,559 | ) | ||
| Gross profit | 735,579 | 57,764 | 865,025 | |||||
| Other operating income | 2,313 | 2,016 | 12,621 | |||||
| Other operating expenses | (84 | ) | (4 | ) | 4,272 | |||
| General and administrative expenses | (55,898 | ) | (35,377 | ) | (163,210 | ) | ||
| Share of profits of associates | 1,545 | 497 | 3,341 | |||||
| Results from operating activities | 683,455 | 24,896 | 722,049 | |||||
| Net finance expenses | (39,445 | ) | (33,727 | ) | (181,260 | ) | ||
| Profit (loss) before income taxes | 644,010 | (8,831 | ) | 540,789 | ||||
| Income taxes | (54,422 | ) | (3,086 | ) | (16,599 | ) | ||
| Profit (loss) for the period | 589,588 | (11,917 | ) | 524,190 | ||||
| Attributable to: | ||||||||
| Owners of the Company | 587,599 | (13,549 | ) | 517,961 | ||||
| Non-controlling interests | 1,989 | 1,632 | 6,229 | |||||
| Profit (loss) for the period | 589,588 | (11,917 | ) | 524,190 | ||||
| Earnings (loss) per share (US)* | ||||||||
| Basic earnings (losses) per 1 ordinary share | 5.35 | (0.14 | ) | 5.18 | ||||
| Diluted earnings (losses) per 1 ordinary share | 5.13 | (0.14 | ) | 4.96 | ||||
| Weighted average number of shares for EPS calculation*: | ||||||||
| Basic | 109,777,778 | 100,000,000 | 100,000,000 | |||||
| Diluted | 114,508,115 | 100,000,000 | 104,530,892 |
All values are in US Dollars.
(*) Reflect a share split of 1:10 that became effective in 2021, in all presented periods.
CONSOLIDATEDSTATEMENTS OF CASH FLOWS
(U.S.dollars in thousands)
| Three months ended<br> March 31, | Year ended <br> December 31, | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2020 | |||||||
| Cash flows from operating activities | |||||||||
| Profit (loss) for the year | 589,588 | (11,917 | ) | 524,190 | |||||
| Adjustments for: | |||||||||
| Depreciation and amortization | 133,585 | 72,133 | 314,185 | ||||||
| Impairment recovery in respect of tangible assets | (4,329 | ) | |||||||
| Net finance expenses | 39,445 | 33,727 | 181,260 | ||||||
| Share of profits and change in fair value of investees | (2,432 | ) | (497 | ) | (4,143 | ) | |||
| Capital gains | (431 | ) | (1,310 | ) | (8,814 | ) | |||
| Income taxes | 54,422 | 3,086 | 16,599 | ||||||
| 814,177 | 95,222 | 1,018,948 | |||||||
| Change in inventories | (34,019 | ) | 3,643 | 8,105 | |||||
| Change in trade receivables and other receivables | (174,298 | ) | 2,243 | (204,469 | ) | ||||
| Change in trade and other payables including contract liabilities | 175,698 | 9,203 | 68,670 | ||||||
| Change in provisions and employee benefits | (728 | ) | (7,132 | ) | (2,152 | ) | |||
| (33,347 | ) | 7,957 | (129,846 | ) | |||||
| Dividends received from associates | 711 | 15 | 4,360 | ||||||
| Interest received | 769 | 876 | 2,317 | ||||||
| Income taxes paid | (4,909 | ) | (2,495 | ) | (14,983 | ) | |||
| Net cash generated from operating activities | 777,401 | 101,575 | 880,796 | ||||||
| Cash flows from investing activities | |||||||||
| Proceeds from sale of tangible assets, intangible assets, investments and affiliates | 504 | 1,349 | 6,717 | ||||||
| Acquisition of tangible assets, intangible assets and<br> investments | (132,998 | ) | (3,561 | ) | (42,641 | ) | |||
| Change in other investments and other receivables | (2,061 | ) | (1,241 | ) | 763 | ||||
| Net cash used in investing activities | (134,555 | ) | (3,453 | ) | (35,161 | ) |
CONSOLIDATEDSTATEMENTS OF CASH FLOWS
(U.S.dollars in thousands)
| Three months ended<br> March 31, | Year ended <br> December 31, | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2020 | |||||||
| Cash flows from financing activities | |||||||||
| Issuance of share capital, net of issuance costs | 205,394 | ||||||||
| Sale and lease back transactions | 8,400 | 9,052 | |||||||
| Repayment of borrowings and lease liabilities | (190,403 | ) | (63,557 | ) | (336,225 | ) | |||
| Change in short-term loans | (975 | ) | 3,571 | 6,071 | |||||
| Dividend paid to non-controlling interests | (2,808 | ) | (3,344 | ) | |||||
| Interest and other financial expenses paid | (34,851 | ) | (30,467 | ) | (135,952 | ) | |||
| Net cash used in financing activities | (23,643 | ) | (82,053 | ) | (460,398 | ) | |||
| Net change in cash and cash equivalents | 619,203 | 16,069 | 385,237 | ||||||
| Cash and cash equivalents at beginning of the period | 570,414 | 182,786 | 182,786 | ||||||
| Effect of exchange rate fluctuation on cash held | (1,209 | ) | (2,114 | ) | 2,391 | ||||
| Cash and cash equivalents at the end of the period | 1,188,408 | 196,741 | 570,414 |
RECONCILIATIONOF NET INCOME (LOSS) TO ADJUSTED EBIT
(U.S.dollars in millions)
| Three months ended<br> March 31, | ||||||
|---|---|---|---|---|---|---|
| 2021 | 2020 | |||||
| Net income (loss) | 590 | (12 | ) | |||
| Financial expenses (income), net | 39 | 34 | ||||
| Income taxes | 54 | 3 | ||||
| Operating income (EBIT) | 683 | 25 | ||||
| Non-cash charter hire expenses | 1 | 2 | ||||
| Expenses related to legal contingencies | 4 | 0 | ||||
| Adjusted EBIT | 688 | 27 | ||||
| Adjusted EBIT margin | 39 | % | 3 | % |
RECONCILIATIONOF NET INCOME (LOSS) TO ADJUSTED EBITDA
(U.S.dollars in millions)
| Three months ended<br> March 31, | ||||||
|---|---|---|---|---|---|---|
| 2021 | 2020 | |||||
| Net income (loss) | 590 | (12 | ) | |||
| Financial expenses (income), net | 39 | 34 | ||||
| Income taxes | 54 | 3 | ||||
| Depreciation and amortization | 134 | 72 | ||||
| EBITDA | 817 | 97 | ||||
| Expenses related to legal contingencies | 4 | 0 | ||||
| Adjusted EBITDA | 821 | 97 | ||||
| Adjusted EBITDA margin | 47 | % | 12 | % |
RECONCILIATIONOF NET CASH GENERATED FROM OPERATING ACTIVITES TO FREE CASH FLOW
(U.S.dollars in millions)
| Three months ended<br> March 31, | ||||||
|---|---|---|---|---|---|---|
| 2021 | 2020 | |||||
| Net cash generated from operating activities | 777 | 102 | ||||
| Net cash used in investing activities | (134 | ) | (4 | ) | ||
| Free cash flow | 643 | 98 |
Exhibit 99.2
ZIM INTEGRATEDSHIPPING SERVICES LTD.
CONDENSEDCONSOLIDATED UNAUDITED INTERIM
FINANCIALSTATEMENTS
MARCH31, 2021
INDEX TO CONDENSED CONSOLIDATED UNAUDITED INTERIM FINANCIAL STATEMENTS
| Page | |
|---|---|
| FINANCIAL STATEMENTS: | |
| Condensed consolidated unaudited interim Statements of Financial Position | 3 |
| Condensed consolidated unaudited interim Income Statements | 4 |
| Condensed consolidated unaudited interim Statements of Comprehensive Income | 5 |
| Condensed consolidated unaudited interim Statements of Changes in Equity | 6 |
| Condensed consolidated unaudited interim Statements of Cash Flows | 7-8 |
| Notes to the condensed consolidated unaudited interim Financial Statements | 9-13 |
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF FINANCIAL POSITION
| March 31, | December 31, | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2020 | |||||||
| Note | US ’000 | ||||||||
| Assets | |||||||||
| Vessels | 6 | 737,047 | 948,004 | ||||||
| Containers and handling equipment | 6 | 437,639 | 520,887 | ||||||
| Other tangible assets | 67,877 | 67,133 | |||||||
| Intangible assets | 65,716 | 66,465 | |||||||
| Investments in associates | 9,171 | 8,441 | |||||||
| Other investments | 2,717 | 4,888 | |||||||
| Trade and other receivables | 5,390 | 5,293 | |||||||
| Deferred tax assets | 1,018 | 1,502 | |||||||
| Total non-current assets | 1,326,575 | 1,622,613 | |||||||
| Assets classified as held for sale | 10,564 | ||||||||
| Inventories | 56,699 | 52,237 | |||||||
| Trade and other receivables | 306,557 | 520,001 | |||||||
| Other investments | 59,510 | 58,976 | |||||||
| Cash and cash equivalents | 196,741 | 570,414 | |||||||
| Total current assets | 630,071 | 1,201,628 | |||||||
| Total assets | 1,956,646 | 2,824,241 | |||||||
| Equity | |||||||||
| Share capital and reserves | 5(a) | 1,783,479 | 1,790,794 | ||||||
| Accumulated deficit | ) | (2,053,010 | ) | (1,523,528 | ) | ||||
| Equity attributable to owners of the Company | (269,531 | ) | 267,266 | ||||||
| Non-controlling interests | 4,327 | 7,189 | |||||||
| Total equity | (265,204 | ) | 274,455 | ||||||
| Liabilities | |||||||||
| Lease liabilities | 659,649 | 811,840 | |||||||
| Loans and other liabilities | 4(c) | 550,265 | 519,471 | ||||||
| Employee benefits | 58,252 | 66,626 | |||||||
| Deferred tax liabilities | 347 | 339 | |||||||
| Total non-current liabilities | 1,268,513 | 1,398,276 | |||||||
| Trade and other payables | 431,223 | 398,876 | |||||||
| Provisions | 16,081 | 21,420 | |||||||
| Contract liabilities | 125,109 | 230,469 | |||||||
| Lease liabilities | 236,835 | 362,176 | |||||||
| Loans and other liabilities | 144,089 | 138,569 | |||||||
| Total current liabilities | 953,337 | 1,151,510 | |||||||
| Total liabilities | 2,221,850 | 2,549,786 | |||||||
| Total equity and liabilities | 1,956,646 | 2,824,241 |
All values are in US Dollars.
| /s/ Yair Seroussi | /s/ Eli Glickman | /s/ Xavier Destriau |
|---|---|---|
| Yair Seroussi | Eli Glickman | Xavier Destriau |
| Chairman of the Board of Directors | President & Chief Executive Officer | Chief Financial Officer |
Date of approval of the Financial Statements: May 19, 2021
The accompanying Notes are an integral part of these condensed consolidated unaudited interim Financial Statements.
3
CONDENSED CONSOLIDATED UNAUDITED INTERIM INCOME STATEMENTS
| Three months ended<br> March 31, | Year ended<br><br> December 31, | |||||||
|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2020 | ||||||
| US ’000 | ||||||||
| Income from voyages and related services | 823,215 | 3,991,696 | ||||||
| Cost of voyages and related services: | ||||||||
| Operating expenses and cost of services | ) | (698,388 | ) | (2,835,112 | ) | |||
| Depreciation | ) | (67,063 | ) | (291,559 | ) | |||
| Gross profit | 57,764 | 865,025 | ||||||
| Other operating income | 2,016 | 12,621 | ||||||
| Other operating expenses | ) | (4 | ) | 4,272 | ||||
| General and administrative expenses | ) | (35,377 | ) | (163,210 | ) | |||
| Share of profit of associates | 497 | 3,341 | ||||||
| Results from operating activities | 24,896 | 722,049 | ||||||
| Finance income | 4,728 | 8,103 | ||||||
| Finance expenses | ) | (38,455 | ) | (189,363 | ) | |||
| Net finance expenses | ) | (33,727 | ) | (181,260 | ) | |||
| Profit (loss) before income taxes | (8,831 | ) | 540,789 | |||||
| Income taxes | ) | (3,086 | ) | (16,599 | ) | |||
| Profit (loss) for the period | (11,917 | ) | 524,190 | |||||
| Attributable to: | ||||||||
| Owners of the Company | (13,549 | ) | 517,961 | |||||
| Non-controlling interests | 1,632 | 6,229 | ||||||
| Profit (loss) for the period | (11,917 | ) | 524,190 | |||||
| Earnings (loss) per share (US) | ||||||||
| Basic earnings (losses) per 1 ordinary share | (*)(0.14 | ) | 5.18 | |||||
| Diluted earnings (losses) per 1 ordinary share | (*)(0.14 | ) | 4.96 |
All values are in US Dollars.
(*) Restated to reflect a share split of 1:10 that became effective in 2021 (see Note 5(a)).
The accompanying Notes are an integral part of these condensed consolidated unaudited interim Financial Statements.
4
CONDENSED CONSOLIDATED UNAUDITED INTERIM STATEMENTS OF COMPREHENSIVE INCOME
| Three months ended<br> March 31, | Year ended<br><br> December 31, | ||||||
|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2020 | |||||
| US ’000 | |||||||
| Profit (loss) for the period | (11,917 | ) | 524,190 | ||||
| Other components of Comprehensive Income | |||||||
| Items of other comprehensive income that were or will be reclassified to profit and loss | |||||||
| Foreign currency translation differences for foreign operations | ) | (2,207 | ) | 4,019 | |||
| Items of other comprehensive income that would never be reclassified to profit and loss | |||||||
| Net change in fair value of investments in equity instruments at fair value through other comprehensive income, net of tax | ) | (297 | ) | 563 | |||
| Defined benefit pension plans actuarial<br> gains, net of tax | 3,062 | 174 | |||||
| Othercomprehensive income for the period, net of tax | ) | 558 | 4,756 | ||||
| Total comprehensive income for the period | (11,359 | ) | 528,946 | ||||
| Attributable to: | |||||||
| Owners of the Company | (12,223 | ) | 523,815 | ||||
| Non-controlling interests | 864 | 5,131 | |||||
| Total comprehensive income for the period | (11,359 | ) | 528,946 |
All values are in US Dollars.
The accompanying Notes are an integral part of these condensed consolidated unaudited interim Financial Statements.
5
CONDENSED CONSOLIDATED UNAUDITED INTERIM STATEMENTS OF CHANGES IN EQUITY
| Attribute to the owners of the Company | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| **** | Share capital<br> (*) | General reserves (**) | Translation reserve | **** | Accumulated deficit | **** | Total | **** | Non- controlling interests | **** | Total equity | **** | ||||||
| US ’000 | ||||||||||||||||||
| For the three months period ended March 31,<br> 2021 | ||||||||||||||||||
| Balance at January 1, 2021 | 1,106,470 | (15,986 | ) | (1,523,528 | ) | 267,266 | 7,189 | 274,455 | ||||||||||
| Profit for the period | 587,599 | 587,599 | 1,989 | 589,588 | ||||||||||||||
| Other comprehensive income for<br> the period, net of tax | (2,260 | ) | (172 | ) | (2,432 | ) | (1,042 | ) | (3,474 | ) | ||||||||
| Issuance of share capital, net<br> of issuance costs | 203,513 | 203,513 | ||||||||||||||||
| Share-based compensation | 331 | 331 | 331 | |||||||||||||||
| Dividend<br> to non-controlling interests in subsidiaries | (4,295 | ) | (4,295 | ) | ||||||||||||||
| Balance at March 31,<br> 2021 | 1,106,801 | (18,246 | ) | (936,101 | ) | 1,056,277 | 3,841 | 1,060,118 | ||||||||||
| For the three months period ended March 31,<br> 2020 | ||||||||||||||||||
| Balance at January 1, 2020 | 1,105,350 | (21,103 | ) | (2,042,226 | ) | (257,669 | ) | 5,402 | (252,267 | ) | ||||||||
| Profit (loss) for the year | (13,549 | ) | (13,549 | ) | 1,632 | (11,917 | ) | |||||||||||
| Other comprehensive income for<br> the period, net of tax | (1,439 | ) | 2,765 | 1,326 | (768 | ) | 558 | |||||||||||
| Transaction with an interested<br> party, net of tax | 182 | 182 | 182 | |||||||||||||||
| Share-based compensation | 179 | 179 | 179 | |||||||||||||||
| Dividend<br> to non-controlling interests in subsidiaries | (1,939 | ) | (1,939 | ) | ||||||||||||||
| Balance at March 31,<br> 2020 | 1,105,711 | (22,542 | ) | (2,053,010 | ) | (269,531 | ) | 4,327 | (265,204 | ) | ||||||||
| For the year ended December 31, 2020 | ||||||||||||||||||
| Balance at January 1, 2020 | 1,105,350 | (21,103 | ) | (2,042,226 | ) | (257,669 | ) | 5,402 | (252,267 | ) | ||||||||
| Profit (loss) for the year | 517,961 | 517,961 | 6,229 | 524,190 | ||||||||||||||
| Other comprehensive income for<br> the year | 5,117 | 737 | 5,854 | (1,098 | ) | 4,756 | ||||||||||||
| Transaction with an interested<br> party, net of tax. | 630 | 630 | 630 | |||||||||||||||
| Share-based compensation | 490 | 490 | 490 | |||||||||||||||
| Dividend<br> to non-controlling interests in subsidiaries | (3,344 | ) | (3,344 | ) | ||||||||||||||
| Balance at December<br> 31, 2020 | 1,106,470 | (15,986 | ) | (1,523,528 | ) | 267,266 | 7,189 | 274,455 |
All values are in US Dollars.
(*) See Note 5(a).
(**) Include reserves related to transactions with an interested party and share-based compensation.
The accompanying Notes are an integral part of these condensed consolidated interim Financial Statements.
6
CONDENSED CONSOLIDATED UNAUDITED INTERIM STATEMENTS OF CASH FLOWS
| **** | Three months ended <br> March 31, | **** | Year ended December 31, | **** | ||||
|---|---|---|---|---|---|---|---|---|
| **** | 2021 | **** | 2020 | **** | 2020 | **** | ||
| **** | US ’000 | **** | ||||||
| Cash flows from operating activities | ||||||||
| Profit (loss) for the period | (11,917 | ) | 524,190 | |||||
| Adjustments for: | ||||||||
| Depreciation and amortisation | 72,133 | 314,185 | ||||||
| Impairment recovery in respect of tangible assets | (4,329 | ) | ||||||
| Net finance expenses | 33,727 | 181,260 | ||||||
| Share of profits and change in fair value of investees | ) | (497 | ) | (4,143 | ) | |||
| Capital gain | ) | (1,310 | ) | (8,814 | ) | |||
| Income taxes | 3,086 | 16,599 | ||||||
| 95,222 | 1,018,948 | |||||||
| Change in inventories | ) | 3,643 | 8,105 | |||||
| Change in trade and other receivables | ) | 2,243 | (204,469 | ) | ||||
| Change in trade and other payables including contracts<br> liabilities | 9,203 | 68,670 | ||||||
| Change in provisions and employee benefits | ) | (7,132 | ) | (2,152 | ) | |||
| ) | 7,957 | (129,846 | ) | |||||
| Dividends received from associates | 15 | 4,360 | ||||||
| Interest received | 876 | 2,317 | ||||||
| Income taxes paid | ) | (2,495 | ) | (14,983 | ) | |||
| Net cash generated from operating activities | 101,575 | 880,796 | ||||||
| Cash flows from investing activities | ||||||||
| Proceeds from sale of tangible assets, intangible assets, investments and affiliates | 1,349 | 6,717 | ||||||
| Acquisition of tangible assets, intangible assets and investments | ) | (3,561 | ) | (42,641 | ) | |||
| Change in other investments and other receivables | ) | (1,241 | ) | 763 | ||||
| Net cash used in investing activities | ) | (3,453 | ) | (35,161 | ) |
All values are in US Dollars.
The accompanying Notes are an integral part of these condensed consolidated unaudited interim Financial Statements.
7
CONDENSED CONSOLIDATED UNAUDITED INTERIM STATEMENTS OF CASH FLOWS
| Three months ended March 31, | Year ended<br><br> December 31, | |||||||
|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2020 | ||||||
| US ’000 | ||||||||
| Cash flows from financing activities | ||||||||
| Issuance of share capital, net of issuance costs (see Note 5(a)) | ||||||||
| Sale and lease back transactions | 8,400 | 9,052 | ||||||
| Repayment of borrowings and lease liabilities | ) | (63,557 | ) | (336,225 | ) | |||
| Change in short term loans | ) | 3,571 | 6,071 | |||||
| Dividend paid to non-controlling interests | ) | (3,344 | ) | |||||
| Interest and other financial expenses paid | ) | (30,467 | ) | (135,952 | ) | |||
| Net cash used in financing activities | ) | (82,053 | ) | (460,398 | ) | |||
| Net change in cash and cash equivalents | 16,069 | 385,237 | ||||||
| Cash and cash equivalents at beginning of the period | 182,786 | 182,786 | ||||||
| Effect of exchange rate fluctuation on cash held | ) | (2,114 | ) | 2,391 | ||||
| Cash and cash equivalents at the end of the period | 196,741 | 570,414 |
All values are in US Dollars.
The accompanying Notes are an integral part of these condensed consolidated unaudited interim Financial Statements.
8
NOTES TO THE CONDENSED CONSOLIDATED UNAUDITED INTERIM FINANCIAL STATEMENTS
| 1 | Reporting entity |
|---|
ZIM Integrated Shipping Services Ltd. (hereinafter - the "Company" or "Zim") and its subsidiaries (hereinafter – "the Group" or "the Companies") and the Group’s interests in associates, operate in the field of container shipping and related services.
Zim is a company incorporated in Israel, with limited liability. ZIM’s ordinary shares have been listed on the New York Stock Exchange (the “NYSE”) under the symbol “ZIM” on January 28, 2021. The address of the Company’s registered office is 9 Andrei Sakharov Street, Haifa, Israel.
| 2 | Basis of compliance |
|---|---|
| (a) | Statementof compliance |
| --- | --- |
These condensed consolidated interim unaudited financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting. They do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Company as at and for the year ended December 31, 2020 (hereafter – the “annual Financial Statements”). These condensed consolidated unaudited interim Financial Statements were approved by the Board of Directors on May 19, 2021.
| (b) | Estimates |
|---|
The preparation of Financial Statements in conformity with IFRSs requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. The significant judgments made by management in applying the Group’s accounting policies and the principal assumptions used in the estimation of uncertainty were the same as those applied to the annual financial statements.
| 3 | Significant accounting policies |
|---|
The accounting policies applied by the Group in these unaudited condensed consolidated interim Financial Statements are the same as those applied by the Group in its annual Financial Statements.
| 4 | Financial position |
|---|---|
| (a) | The container<br> shipping industry is characterized in recent years by volatility in freight rates, charter<br> rates and bunker prices, accompanied by significant uncertainties in the global trade (including<br> further implications that might derive from the Covid-19 pandemic). Current market conditions<br> impact positively, as during the first quarter of 2021 freight rates continued to increase,<br> resulting in improved results of the Company. |
| --- | --- |
In view of the aforementioned business environment and in order to constantly improve the Group’s results of operations and liquidity position, Management continues to optimize its network by entering into new partnerships and cooperation agreements and by upgrading its customer’s offerings, whilst seeking operational excellence and cost efficiencies. In addition, the Company continues to explore options which may contribute to strengthen its capital and operational structure. In respect of the Company’s initial public offering, completed in February 2021, see Note 5(a).
Since January 1, 2021, the Company has entered into multiple agreements for the purchase of containers (mostly new-build units) in an aggregate amount of US$588 million. During the first quarter of 2021, the Company recognized additions in an aggregated cost of US$104 million in respect of delivered containers, out of such purchases.
9
NOTES TO THE CONDENSED CONSOLIDATED UNAUDITED INTERIM FINANCIAL STATEMENTS
| 4 | Financial position (Cont’d) |
|---|
In February 2021, the Company entered into a strategic agreement with Seaspan, for the long-term charter of ten 15,000 TEU liquefied natural gas (LNG) dual-fuel container vessels, intended to be delivered between February 2023 and January 2024. Pursuant to the agreement, the Company will charter the vessels for a period of 12 years and has secured an option to later elect a total charter period of 15 years to be applied to all chartered vessels. According to the agreement, the Company expects to incur between US$16 million and US$17 million in annualized charter hire costs per vessel, over the term of the agreement, depending on the charter period elected. The Company was further granted by Seaspan a right of first refusal to purchase the chartered vessels should Seaspan choose to sell them during the charter period and an option to purchase the vessels at the end of the charter term. The Company intends to deploy these vessels on its Asia-US East Coast Trade, as an enhancement to its service on this strategic trade.
As at March 31, 2021, the Company complies with its financial covenants. The Company’s liquidity amounts to US$1,189 million (Minimum Liquidity required is US$125 million) - see also Note 12(c) to the 2020 annual financial statements.
| (b) | In accordance<br> with IAS 34 (Interim financial reporting), the Company records its tax expenses based on<br> the estimated annual effective tax rate. In light of its current results (see also Note 4(a)),<br> the Company expects to utilize its carry-forward tax losses and therefore considers utilization<br> of carry-forward tax losses in its estimated annual effective tax rate. The Company’s<br> income tax expenses for the three months ended March 31, 2021 include $34 million of deferred<br> tax expenses, which offset previously recorded deferred tax assets. |
|---|---|
| (c) | In March<br> 2021, the Company made an early repayment of US$85 million of its Series 1 notes (Tranche<br> C), in accordance with the related excess cash mechanism (see also Note 12(b) to the 2020<br> annual financial statements). In April 2021, the Company announced an additional early repayment<br> under such mechanism (which also considered balances during April 2021), in respect of its<br> Series 1 and Series 2 notes (Tranches C and D), in a total amount of US$349 million, to<br> be carried out in June 2021. This payment reflects a full settlement of the outstanding indebtedness<br> related to such notes and will result in the removal of the related provisions and limitations. |
| --- | --- |
| (d) | Following<br> the reporting date, the Company was served with a claim for an alleged patents infringement<br> filed against it in the US. At this preliminary stage, based on the opinion of the Company’s<br> legal advisors, the outcome of this matter cannot be assessed. See also Note 27 to the Company’s<br> 2020 annual financial statements, in respect of contingencies. |
| --- | --- |
| (e) | In May 2021,<br> further to the above-mentioned expected full repayment of Series 1 and Series 2 notes, the<br> Company’s Board of Directors approved a distribution of dividend of approximately US$2.00 per ordinary share (approximately US$238 million, assuming that by the record date,<br> all options to purchase the Company’s ordinary shares that will be exercisable on or<br> before the record date, will be exercised by their respective option holders). The dividend<br> is scheduled to be paid on September 15, 2021, to all holders of ordinary shares on record<br> as at August 25, 2021. |
| --- | --- |
| 5 | Capital and reserves |
| --- | --- |
| (a) | Share capital |
| --- | --- |
In February 2021, the Company completed its initial public offering (IPO) of 15,000,000 ordinary shares (including shares issued upon the exercise of the underwriters’ option), at an offering price of $15.00 per share, for gross consideration of $225 million ($204 million, after deducting underwriting discounts and commissions and other offering costs). The Company’s ordinary shares began trading on The New York Stock Exchange (the “NYSE”) under the symbol “ZIM” on January 28, 2021.
10
NOTES TO THE CONDENSED CONSOLIDATED UNAUDITED INTERIM FINANCIAL STATEMENTS
| 5 | Capital and reserves (cont’d) |
|---|
Further to the approval of the Company’s General meeting in December 2020 and the completion of the Company’s IPO, the Company’s ordinary shares were amended to have no par value, as well as to reflect a share split of 1:10, in the form of issuing benefit shares (nine ordinary shares issued for each existing ordinary share). Accordingly, for earnings per share, these financial statements reflect the abovementioned share split retrospectively, in all presented periods.
| (b) | Share-Based Payment Arrangements |
|---|
During the first quarter of 2021, further to prior approvals of the Company’s Compensation committee, Audit committee and Board of Directors, and concurrently with the consummation of the Company’s initial public offering, the Company granted a senior member of the Company’s Management with options exercisable to its ordinary shares, according to the below terms (which also reflects the above-mentioned share split):
| Grant date | Instrument terms | Vesting Terms | Contractual <br><br>life | |
|---|---|---|---|---|
| January 27, 2021 | Each option is exercisable into one ordinary share, at the exercise price per the offering price of 15.00 | 546,822 | 25% of the options shall vest upon the first anniversary of the grant date with the remaining options vesting in equal quarterly portions over the following three years period. | 5 years |
All values are in US Dollars.
Information on fair value measurement
The weighted average fair value of the options on grant date was $5.32, measured using the Black & Scholes model, based on the following measurement inputs:
| Share<br> price on grant date | USD<br> 15.00 | ||||
|---|---|---|---|---|---|
| Exercise<br> price | USD<br> 15.00 | ||||
| Expected<br> volatility | 40.2% | ||||
| Expected<br> life | 5<br> years | ||||
| Expected<br> dividends | 0% | ||||
| Risk-free<br> interest rate | 0.46% | ||||
| 6 | Right-of-use assets | ||||
| --- | --- | ||||
| Balance at <br>March 31, | Balance at<br><br> December 31, | ||||
| --- | --- | --- | --- | --- | --- |
| 2021 | 2020 | 2020 | |||
| US ’000 | |||||
| Vessels | 621,654 | 826,678 | |||
| Containers and handling equipment | 398,502 | 466,070 | |||
| Other tangible assets | 49,145 | 47,911 | |||
| 1,069,301 | 1,340,659 |
All values are in US Dollars.
11
NOTES TO THE CONDENSED CONSOLIDATED UNAUDITED INTERIM FINANCIAL STATEMENTS
| 7 | Segment information |
|---|
ZIM is managed as one operating unit, generating revenues from operating a global liner service network of container shipping and related services. The Group service lines share the use of its resources and their performance are co-dependent. Accordingly, the chief operating decision maker manages and allocates resources to the entire liner network. As there is no appropriate allocation for the Group’s results, assets and liabilities, these are all attributed to the Group’s sole operating segment.
Freight revenues are disaggregated geographically by trade zone, as follows:
| Three months ended March 31, | Year ended<br><br> December 31, | ||||
|---|---|---|---|---|---|
| 2021 | 2020 | 2020 | |||
| US ’000 | |||||
| Freight Revenues from containerized cargo: | |||||
| Pacific | 314,205 | 1,860,554 | |||
| Cross-Suez | 92,729 | 392,679 | |||
| Atlantic | 152,944 | 577,443 | |||
| Intra-Asia | 86,878 | 453,127 | |||
| Latin America | 49,713 | 208,374 | |||
| 696,469 | 3,492,177 | ||||
| Other Revenues (*) | 126,746 | 499,519 | |||
| 823,215 | 3,991,696 |
All values are in US Dollars.
(*) Mainly related to demurrage, value-added services and non-containerized cargo.
| 8 | Financial instruments |
|---|
Financial instruments not measured at fair value
The carrying amounts of the Group’s financial assets and liabilities, including cash and cash equivalents, trade and other receivables, other investments, trade and other payables and loans and other liabilities, reflect reasonable approximation of their fair value.
12
NOTES TO THE CONDENSED CONSOLIDATED UNAUDITED INTERIM FINANCIAL STATEMENTS
| 9 | Earnings (loss) per share |
|---|
Basic and diluted earnings (loss) per share
| Three months ended March 31, | Year ended<br><br> December 31, | |||||
|---|---|---|---|---|---|---|
| **** | 2021 | 2020 | **** | 2020 | ||
| US ’000 | ||||||
| Profit (loss) attributable to ordinary shareholders used to calculate basic and diluted earnings (loss) per share | (13,549 | ) | 517,961 | |||
| Weighted average number of ordinary shares used to calculate basic earnings (loss) per share | 100,000,000 | 100,000,000 | ||||
| Effect of share options | 4,530,892 | |||||
| Weighted average number of ordinary shares used to calculate diluted earnings (loss) per share | 100,000,000 | 104,530,892 |
All values are in US Dollars.
For the three months period ended March 31, 2020, options for 4,990,000 ordinary shares were excluded from the diluted weighted average number of ordinary shares calculation, as their effect would have been anti-dilutive.
The Company’s ordinary shares began trading on January 28, 2021. Due to the absence of a trading market for the Company’s ordinary shares prior to this date, the fair value of these shares during such period, for purposes of determining the exercise price for options, was determined by Company’s management and approved by the Company’s board of directors.
| 10 | Related parties |
|---|
During the first quarter of 2021, the total balance of loans and lease liabilities attributed to related parties, increased by a net amount of US$43 million, mainly due to charter hire of vessels - see also Note 28 to the 2020 annual financial statements.
13