ZIM Integrated Shipping Services Ltd. (ZIM) pulled back on its earlier announced profit guidance for the year noting that the near-term outlook for container shipping "has shifted" and the normalization in freight rates has begun.

This comes as the Israeli shipping line reported lower volumes and income in the third quarter on the back of continuing macroeconomic and geopolitical uncertainties.

In reporting its second-quarter results earlier, ZIM affirmed its US$7.8 billion and US$8.2 billion profit guidance for 2022 and Adjusted EBIT of between US$6.3 billion and US$6.7 billion.

Lower profit guidance for full-year 2022

But current market developments prompted the shipping line to lower its expectations for full-year performance.

"Driven by macroeconomic and geopolitical uncertainties, the near-term outlook for container shipping has shifted and the normalization in freight rates has begun," said Eli Glickman, ZIM president & CEO.

"Based on our current market expectations, we now forecast 2022 adjusted EBITDA of between US$7.4 billion to US$7.7 billion and adjusted EBIT of between US$6.0 billion to US$6.3 billion, and note that both will once again represent full-year records," he added.

In the third quarter, ZIM reported a total revenue of US$3.23 billion, higher than the US$3.14 billion seen in the third quarter of 2021 as the average freight rate per TEU was US$3,353 for the third quarter of 2022, compared to US$3,226 for the third quarter of 2021.

The shipping line carried 842,000 TEUs in the third quarter, also slightly lower than the 884,000 TEUs in the third quarter of last year.

Overall, ZIM said net income for the third quarter of 2022 was US$1.17 billion, compared to US$1.46 billion for the third quarter of 2021.

"Our third quarter and nine-month 2022 results reflect outstanding execution and elevated profitability. While market conditions remained volatile, we delivered strong EBITDA and EBIT margins and generated a net income of US$1.17 billion in the third quarter," Glickman said.

The ZIM chief then signalled that the shipping line is ready to put the company in the "best position" coming into the "new normal."

"The proactive steps we have taken over the past two years, combined with our balance sheet strength, have transformed ZIM and significantly enhanced our resilience both commercially and operationally, to best position our Company for the 'new normal,'" Glickman said.

"As we remain committed to our global niche strategy focused on attractive trades, we have opened several new services during this time, improving our port coverage to better serve our customers and making our commercial presence more resilient and diversified."

The ZIM chief added that the company have also identified growth engines complementary to its container shipping activities, such as ZIM's car carrier activities and digital freight forwarding subsidiary.

"We have also secured competitive and cost-effective newbuild capacity to support our commercial strategy and advance our and our customers’ ESG agenda," Glickman said.