CEVA reduces losses, signs new contracts in Q3

CEVA Logistics’ CEO Xavier Urbain said that the company’s new operating model is continuing to pay off, despite market “headwinds” and the lingering effects of its restructuring plan.

The Netherlands-based forwarder reported 2015 third-quarter revenues of US$1.7 billion, down 13.1 percent from $1.9 billion in Q3 2014, and saw its net losses slow to $58 million, compared to $92 million last year  EBITDA for the quarter was also up 27 percent at $80 million, compared to $63 million in 2014.

Airfreight volumes in Q3 declined 4 percent, year-over-year, but despite the decline, net revenue for air increased 6 percent as a result of an improved procurement setup in a declining rate environment, the company said. CEVA recently contracted two multi-year deals with major customers to offer  lead logistics provider services with an overall annual business value of approximately $80 million.

The company did well in its Contract Logistics segment, Urbain said, with significant new business in the consumer, retail and healthcare sectors. CEVA reported adjusted EBITDA in Contract Logistics of $54 million in the third quarter, up 3.8 percent over Q3 2014, driven by effective space management and improved productivity. In the U.K., the company signed four 10-year contracts for warehousing and transport for fashion retailers Coast, Karen Millen, Oasis and Warehouse, which together amount to $40 million annually.

The company is continuing to build its sales force in the field, which has now grown by 20 percent compared to the same time last year, with a focus on small and medium size companies. Urbain said, “Our focus on process and product improvement for all business lines has allowed us to increase profitability in spite of difficult industry volume evolution.”