Financial Data and Key Metrics Changes - The company generated revenue of $1.6 billion in Q2 2025, a decrease of 15% year-over-year, primarily due to lower freight rates and volumes [4][15] - Net income for Q2 was $24 million, down from $373 million in the same quarter last year [21] - Adjusted EBITDA was $472 million with an adjusted EBITDA margin of 29%, compared to 40% in Q2 2024 [20][21] - Total liquidity stood at $2.9 billion as of June 30, 2025, after paying approximately $470 million in dividends during the quarter [5][15] - The company raised its full-year guidance for adjusted EBITDA to a range of $1.8 billion to $2.2 billion [6][23] Business Line Data and Key Metrics Changes - Carried volumes in Q2 were 895,000 TEUs, a 6% decline year-over-year, attributed to weak Transpacific demand [21][22] - Revenue from non-containerized cargo totaled $111 million, down from $128 million in Q2 2024 [16] - The average freight rate per TEU in Q2 was $1,479, down from $1,674 in the same quarter last year [15][16] Market Data and Key Metrics Changes - The company experienced a 10% volume growth year-over-year in Latin America, contrasting with the decline in volumes from China [10][22] - The Transpacific demand was weak, and the company does not anticipate a strong peak season due to ongoing tariff uncertainties [9][10] - The overall market fundamentals indicate supply growth outpacing demand, with a projected 6% increase in supply for 2025 [13][25] Company Strategy and Development Direction - The company aims to build a strong commercial presence in key markets and diversify its geographic footprint to enhance business resilience [7][8] - A focus on maintaining a modern and cost-competitive fleet is emphasized, with plans for long-term charter agreements for LNG dual-fuel vessels [11][12] - The company is adapting its Transpacific network to changes in cargo flow due to tariff announcements, aiming to capitalize on growth in Southeast Asia [7][9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current turbulent market environment, citing a transformed fleet and improved cost structure [6][61] - The company anticipates continued pressure on freight rates and a weaker peak season due to tariff-related disruptions [10][23] - Management highlighted the importance of agility in operational capacity to respond to shifting market dynamics [12][13] Other Important Information - The company operates 123 containerships with a total capacity of 767,000 TEUs, with two-thirds of this capacity coming from new vessels delivered in 2023 and 2024 [17][18] - The company has options to extend charter periods and purchase options for its LNG vessels, providing flexibility in capacity management [18][19] Q&A Session Summary Question: Expectations on volume for the second half of the year - Management indicated that the expectation of flat volumes is driven by both market conditions and potential pullbacks in capacity due to expiring charters [30][31] Question: Capacity renewal strategy - Management stated that if market conditions continue to deteriorate, they are more likely to downsize rather than renew charters [35] Question: Impact of tariff changes on capacity - Management noted that the influx of capacity has not been rerouted due to ongoing market conditions and alliance adjustments [36][37] Question: Timing effects of freight rates - Management confirmed that there is a timing lag in revenue recognition due to the surge in spot rates, which will impact Q3 performance [42][43] Question: Cost structure and breakeven levels - Management acknowledged that costs have increased compared to pre-pandemic levels, influenced by various factors including fuel transition and operational inefficiencies [46][50] Question: Cost improvement initiatives - Management outlined several cost improvement strategies, including scaling up vessel sizes, transitioning to LNG, and leveraging partnerships to maintain cost efficiency [55][58]

Financial Data and Key Metrics Changes - The company generated revenue of $2 billion in Q1 2025, representing a year-over-year increase of 28% [7][17] - Net income for the first quarter was $296 million, compared to $92 million in Q1 2024 [22] - Adjusted EBITDA was $779 million with a margin of 39%, and adjusted EBIT was $463 million with a margin of 23% [8][22] - The average freight rate per TEU was $1,776, a 22% increase year-over-year [18] - Free cash flow in Q1 totaled $787 million, significantly up from $3 million in the previous year [18] Business Line Data and Key Metrics Changes - The company carried 944,000 TEUs in Q1 2025, a 12% increase from 846,000 TEUs in the same period last year [23] - Total revenues from non-containerized cargo were $114 million, slightly up from $111 million in Q1 2024 [18] Market Data and Key Metrics Changes - Transpacific volume grew by 11% in Q1 2025, while Latin America saw a notable 22% year-over-year volume growth [23] - The company anticipates low single-digit volume growth year-over-year for 2025, adjusting from previous expectations [26][50] Company Strategy and Development Direction - The company is focusing on maintaining flexibility in fleet deployment and enhancing business resilience in response to changing market conditions [10][12] - A recent charter agreement for ten LNG dual fuel container ships is part of the strategy to modernize the fleet and meet growing demand for eco-friendly shipping solutions [14] - The company is committed to ESG initiatives, having reduced carbon intensity by 35% in 2024 compared to the 2021 baseline [15] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the recent suspension of tariffs between the U.S. and China, viewing it as a positive development for cargo movement [4][5] - The company remains vigilant about geopolitical and macroeconomic uncertainties impacting trade, particularly in the Transpacific market [5][9] - Full-year guidance for adjusted EBITDA is maintained between $1.6 billion and $2.2 billion, reflecting high uncertainty in global trade [9][25] Other Important Information - The company declared a dividend of $0.74 per share for a total of $89 million based on Q1 results, consistent with its dividend policy [8][78] - The fleet transformation program has significantly improved operational efficiency, with approximately 40% of the fleet now LNG-powered [15][22] Q&A Session Summary Question: What are you hearing from customers regarding inventory levels and expectations for peak season? - Management noted that recent tariff changes have revitalized demand, with customers eager to move cargo quickly to avoid inventory shortages [35][36] Question: What is the current status of the Red Sea transit situation? - Management indicated that safety concerns remain high, and they will not return to the Red Sea until it is deemed safe [40][41] Question: Can you provide insight into the Transpacific contract negotiations? - The company confirmed that contract negotiations were affected by market uncertainties, resulting in a 30% contract volume for the upcoming year, similar to last year [44][46] Question: What is the outlook for Q2 profitability? - Management suggested that while Q2 may see increased profitability due to rising demand, uncertainties regarding tariff levels could impact future performance [61][63] Question: How is the company managing its exposure to U.S. port fees for Chinese-built vessels? - The company is actively exploring options to mitigate potential fees by shifting tonnage between trades [59][60] Question: How is the company planning to optimize its cost structure? - Management highlighted ongoing efforts to reduce repositioning costs and invest in digital tools to enhance operational efficiency [75]

Financial Data and Key Metrics Changes - The company generated revenue of $2 billion in Q1 2025, representing a year-over-year increase of 28% [6][18] - Net income for the first quarter was $296 million, compared to $92 million in Q1 2024, marking a significant increase [23] - Adjusted EBITDA was $779 million with a margin of 39%, and adjusted EBIT was $463 million with a margin of 23% [7][23] - The average freight rate per TEU was $1,776, a 22% increase year-over-year, although it was 6% lower than the Q4 average [19] Business Line Data and Key Metrics Changes - The company carried 944,000 TEUs in Q1 2025, a 12% increase from 846,000 TEUs in the same period last year, outperforming the market growth of 4.5% [24] - Total revenues from non-containerized cargo, primarily from car carrier services, totaled $114 million, slightly up from $111 million in Q1 2024 [19] Market Data and Key Metrics Changes - Transpacific volume grew by 11% in Q1 2025, indicating a recovery in trade between the U.S. and China [24] - The company experienced a 22% year-over-year volume growth in Latin America during the first quarter, with expectations to further increase market share in this region [24] Company Strategy and Development Direction - The company is focusing on maintaining flexibility in fleet deployment and adjusting service rotations in response to changing market conditions, particularly in the Transpacific trade [10][12] - A recent charter agreement for ten new LNG dual fuel container ships is part of the company's strategy to enhance commercial agility and support long-term decarbonization objectives [14][15] - The company aims to strengthen its presence in Latin America and Southeast Asia to diversify operations and increase resilience against market fluctuations [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the recent suspension of tariffs between the U.S. and China, viewing it as a positive development but remaining wary of long-term trade agreements [4][5] - The company maintained its full-year guidance for adjusted EBITDA between $1.6 billion and $2.2 billion, despite uncertainties in global trade and geopolitical issues [8][26] - Management highlighted the importance of agility in responding to market changes and emphasized the need for ongoing investment in fleet modernization and operational efficiency [12][16] Other Important Information - The company declared a dividend of $0.74 per share for a total of $89 million based on Q1 results, consistent with its dividend policy [7][81] - The company reported total liquidity of $3.4 billion as of March 31, 2025 [7] Q&A Session Summary Question: What are you hearing from customers regarding inventory levels and expectations for peak season? - Management noted that recent tariff changes have revitalized demand, with customers eager to move cargo quickly to avoid inventory shortages, suggesting a potential early peak season [36][39] Question: How do you view the situation with the Red Sea and Suez Canal? - Management indicated that safety concerns prevent a return to the Red Sea, despite incentives from canal authorities, and emphasized the importance of a stable network [40][41] Question: Can you provide insight into the Transpacific contract negotiations? - Management explained that uncertainties in the market led to a 70% split between contract and spot volumes, down from an expected 50-50 split [47][49] Question: What are the expectations for volume growth in 2025? - Management adjusted volume growth expectations to low single digits due to slower recovery post-Chinese New Year and changes in partnerships affecting fleet utilization [50][53] Question: How much of your fleet is Chinese-built and what mitigation strategies are in place? - Management stated that nearly half of the fleet is Chinese-built and is exploring options to minimize the impact of potential fees on operations [62] Question: What is the outlook for Q2 profitability? - Management acknowledged the recent increase in demand and rates but cautioned about the uncertainty of how long this momentum will last [64][66]

Financial Data and Key Metrics Changes - In 2024, the company reported a net income of $2.2 billion and revenue of $8.4 billion, with adjusted EBITDA of $3.7 billion and adjusted EBIT of $2.5 billion, reflecting a significant financial performance improvement compared to previous years [5][21][26] - The adjusted EBITDA margin was 44% and adjusted EBIT margin was 30%, indicating strong profitability [5][26] - Free cash flow for 2024 totaled $3.6 billion, a substantial increase from $919 million in 2023 [23][26] Business Line Data and Key Metrics Changes - The average freight rate per TEU was $18.88, a 57% increase compared to 2023, with Q4 average freight rate at $18.86, a 71% year-over-year increase [21][22] - The company carried 3.8 million TEUs in 2024, a 14% increase compared to 2023, significantly outperforming the overall market growth of 5.6% [27] - In Q4, the company carried 980,000 TEUs, a 25% increase year-over-year [27] Market Data and Key Metrics Changes - The company experienced a 27% growth in Transpacific volume in 2024, indicating strong market share gains [27] - The company opened new services in Latin America, achieving a 77% year-over-year volume growth in that region [28] - The overall market growth was less than 6%, highlighting the company's superior performance [12][27] Company Strategy and Development Direction - The company aims to maintain a competitive position in the industry by focusing on a modern, fuel-efficient fleet, with 40% of its capacity now LNG powered [10][15][68] - The strategic decision to increase spot exposure in the Transpacific trade to about 65% has allowed the company to capitalize on strong spot rate environments [11] - The company plans to continue investing in technology and digital tools to enhance operational excellence and customer experience [18][71] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategy and competitive position despite high levels of uncertainty in the operating environment due to geopolitical factors and economic policies [6][7] - The company anticipates a significant decline in freight rates in 2025 compared to 2024, with guidance for adjusted EBITDA between $1.6 billion and $2.2 billion [29] - Management highlighted the importance of maintaining flexibility in fleet capacity to adapt to changing market conditions [15][25] Other Important Information - The company declared a dividend of $3.17 per share, totaling $382 million, bringing the total dividend payout for 2024 to $7.98 per share [5] - The company completed its fleet transformation program, receiving all 46 newbuilds secured in 2021 and 2022, enhancing its operational capacity [24][25] Q&A Session Summary Question: Clarification on guidance and Red Sea reopening - Management indicated that both ends of the guidance range assume the Red Sea will reopen this year, with the lower end reflecting an early reopening and the higher end a later reopening [35][36] Question: Exposure to Chinese-built ships and potential management-led buyout - Management confirmed that approximately 25% to 50% of their capacity is Chinese-built, and they are monitoring the situation closely regarding potential additional levies [38][39] - Management refrained from commenting on the rumor of a management-led buyout, focusing instead on executing their long-term strategy [42] Question: Outlook on CapEx and fleet renewals - Management stated that they do not provide quarterly guidance but expect the first half of 2025 to be stronger than the second half due to current market conditions [48][49] - The company plans to renew about 50% of the vessels coming up for renewal, maintaining flexibility in fleet management [51][52] Question: Current rates and fleet composition - Management acknowledged a drop in spot rates in February and indicated ongoing negotiations with long-term customers, with no significant weakness in demand anticipated [74][84] - The company aims to maintain a stable operating capacity in 2025, with potential for a slight reduction depending on renewal decisions [86]