Israeli shipping firm Zim to defer $115 million in payments
05/10/2016 13:39
JERUSALEM, Oct 5 (Reuters) - Israeli shipping company Zim,
which has been hit hard by the weak global shipping market, said
on Wednesday it was planning to defer $115 million of upcoming
payments to creditors until 2018.
Zim said in its second quarter report that it had agreed
with some of its creditors to defer payments for a 12-month
period, which began on Sept 30, until the start of 2018.
Some of the deferrals are still subject to final due
diligence, documentation and approvals.
Zim, whose total liabilities are $1.8 billion, on Wednesday
reported a second-quarter loss of $74.2 million, versus a profit
of $12.1 million a year earlier. Income from voyages dropped to
$612 million from $763 million.
The container shipping industry has suffered from a
prolonged global economic crisis, the company said,
characterised by slower growth of demand and worsening
overcapacity.
In response, carriers, looking to protect their market
share, have allowed freight rates to fall sharply, Zim said.
"Freight rates may remain at depressed levels for some time,
which could adversely affect the company's revenue and
profitability," it said. "Current economic conditions make
forecasting difficult, and there is possibility that actual
performance may be materially different from management plans
and expectations."
Zim has had to restructure its debt in the past, and this
latest deferral comes shortly after larger rival, Hanjin
Shipping Co 117930.KS of South Korea, sought court
receivership in August. urn:newsml:reuters.com:*:nL3N1CA1TC
Zim is 32 percent held by Kenon Holdings KEN.N , with the
remainder held by financial institutions and ship owners.
(Reporting by Ari Rabinovitch. Editing by Jane Merriman)
((ari.rabinovitch@thomsonreuters.com; +972-2-632-2202; Reuters
Messaging: ari.rabinovitch@thomsonreuters.com@reuters.net))
Keywords: ZIM DEBT/