Maalot S&P slashes Zim bond rating by 5 notches

The company would stop operating 10 containerships until the market settles down. Zim plans to reduce shipping capacity on its Asia-U.S. route
 
Maalot S&P, Israel's leading provider of independent credit ratings, slashed last week its rating for Zim's bonds by five notches, to BB+, with a negative outlook.
 
The rating company previously had given the maritime shipping company and Israel Corp subsidiary a rating of A with a negative outlook.
 
Zim reported a loss of $132 million for January through September 2008, with revenues of $3.4 billion, compared to a profit of $33 million and turnover of $2.7 billion in the same period in 2007.
Zim's business activity has been slowing recently due to world recession.
 
The amount of unemployed containership tonnage worldwide is put at 303 units of TEU 880,000, equivalent to 6.5% of the total fleet. This compares with TEU 550,000 idle at the start ofthe year, and TEU 150,000 at the end of October 2008 when the downturn first started to really bite.
 
Last month, it was reported that the company would stop operating 10 containerships until the international market settles down. In addition, it plans to reduce shipping capacity on its Asia-U.S. route due to low demand over the winter. The company has decommissioned 16 ships, or 20% of its total shipping capacity.