May 06, 2014: CEVA Holdings LLC ("CEVA"), one of the world's leading non-asset based supply chain management companies, today reported results for the first quarter ended 31 March, 2014.
"CEVA continues to show strength in Contract Logistics driven by initiatives the company put in place to increase profitability," said CEVA CEO Xavier Urbain, who took over as the company's Chief Executive in January. "We have not, however, been immune to market conditions that have impacted Freight Management. Despite that, I am pleased to report we had our strongest quarter in nearly two years for new business wins, showing particular strength in Freight Management as we exited the quarter. While revenue from these wins won't be reflected until subsequent quarters, it shows positive momentum in the business.
"During my first few months at CEVA, I have visited many of our operational bases and have been impressed by both the professionalism and commitment of our people. It is clear that we have tremendous potential that can be focused on building the top line while we also continue to keep tight control on costs."
CEVA reported revenue of $1,865 million for the three months ended 31 March 2014, down 8.9% year-on year, as continuing weakness in Airfreight and Oceanfreight overall impacted Freight Management performance, where revenues decreased 11.5% compared to the same period last year.
Adjusted EBITDA1 increased 7.5% to $43 million, driven by a strong performance in Contract Logistics where profits increased 37.8% as part of CEVA's decision to exit underperforming contracts last year, which also resulted in an expected and planned reduction in revenue in this segment. The strong performance in Contract Logistics was offset by weakness in Freight Management where lower volumes and margin pressure out of Asia adversely impacted performance.
The quarter showed momentum in new business performance led by excellent results in the Automotive sector led by two significant individual wins with blue-chip customers. These major new contracts are being implemented currently.
During the first quarter, CEVA announced a number of new contracts, expansions and enhancements, including a three year contract with MANN+HUMMEL, a customs brokerage deal with Volvo, an expanded presence in Panama City, as well as in four strategic Mexican markets, and the introduction of CEVA's Mobility Suite based on CEVA Matrix® Transportation Management Solution (TMS).
Separately, the company also announced the completion of a capital structure refinancing that extended all material maturities and increased liquidity by $100 million.