New business wins up by 31pc at Ceva

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Ceva has seen new business wins rise by 31 per cent in the second quarter, increasing to $763 million, compared to $582m for the same period in 2013.

Revenue at $1.98 billion declined 4.2 per cent in the second quarter compared to $2.1bn year earlier. The group said this was driven by the prior year’s recapitalisation, and termination of lower margin business. Second quarter revenue was up 6.1 per cent on the first quarter of 2014.

EBITDA was up 40 per cent on the previous quarter, but 25 per cent lower than in the same period a year earlier as Freight Management revenue was impacted by lower rates in the market. The group said it had been able to maintain net revenue margins versus the prior year.

The improved level of business wins was attributed to investment in tender management, trade lane management and field sales force.

Chief finance officer Rubin McDougal  said the quarter had laid the base for growth in the longer term.

Ceva has strengthened its balance sheet, first in May last year with a €1.3 billion recapitalisation, and then in March of this year with a $1.75 billion refinancing. This transaction lowers the average interest rate it pays, and increases capital available to fund growth initiatives.
McDougal said Ceva was now looking to invest in growing the business. Ceva is particularly strong in automotive, technology, energy, industrial and consumer sectors. Geographically it China and Latin America as growth markets.

Air freight and Ocean freight reported export volumes up both sequentially and year-on-year. Ocean freight volumes were up seven per cent from the prior year, evidencing the company’s early success in the 2014 tender season and well above industry growth.

Air freight volumes increased one per cent from the prior year, strengthening as we exited the quarter, with three week rolling volumes up four per cent in June.

CEO Xavier Urbain said: “Our performance improvement coupled with the strong increase in our new business pipeline points to the company being on the right track for growth. Since joining Ceva in January, I have focused on strengthening the executive management team, expanding our current talent base with additional industry experience to drive forward our strategy, building revenue and improving operational efficiency for the benefit of our customers.

“The numbers show we are gaining traction and are positioned well to make further progress in the future.”

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