CMA CGM S.A. 5.5NC2 SENIOR UNSECURED NOTES
Credit Strength
We view CMA CGM as a strong credit, supported by its position as the world’s third-largest freight operator with a well-diversified global footprint. The group generates revenue across three segments: Shipping (63%), Logistics (32%), and Other activities (5%) such as port terminals and air cargo.
In Q1 2025, the Shipping segment was the key earnings driver, benefiting from higher volume and pricing. Container volume rose by 0.2m TEUs year-on-year to 5.8m TEUs, while unit revenue increased 7.1% to $1,498 per TEU. Cost inflation remained contained, with unit cost rising only 1.2% to $1,065. As a result, adjusted EBITDA rose by $0.6 billion to $2.5 billion, with EBITDA margin improving by 4.1 percentage points.
Logistics performance was bolstered by the CEVA acquisition, with Q1 2025 revenue up 10.1% year-on-year. Despite lower net revenue due to the repositioning of low-margin contracts, profitability improved meaningfully through margin expansion and operational turnaround.
Recent developments in global trade dynamics have supported freight rate increases. Shipping volumes rose 4.8% year-to-date through April 2025, partly due to frontloading ahead of tariff changes. Despite ongoing geopolitical uncertainties—particularly in the Red Sea—CMA CGM has demonstrated resilience, supported by a conservative balance sheet with net leverage at 1.1x and economic leverage at 0.9x.
Financially, the group reported LTM Q1 2025 revenue of $56.9 billion, up from $55.5 billion in FY2024, driven mainly by shipping growth. Adjusted EBITDA rose to $14.1 billion, with margins expanding to 24.9% from 24.2% in FY2024. Liquidity remains robust at $11.2 billion. While net debt increased modestly to $12.3 billion as of March 2025, it remains well-covered by EBITDA.
Capex is projected to rise to $7.7 billion in FY2025, reflecting investment in fleet expansion, with $4.6 billion allocated to new vessels for delivery between 2025 and 2029. Capex is expected to normalize to $5.5 billion by FY2026.
FV thought
CMACG 5.5 07/15/29 was the best comp. At pricing of the new note, the 2029 note calling at Jul 28 was trading at 4.3%, Z+220, we saw the new Jan 2031 note FV was at 4.85%.