The logo of shipping company CMA-CGM is pictured on a container in Montoir-de-Bretagne near Saint-Nazaire, France, March 4, 2022. REUTERS/Stephane Mahe

PARIS, June 3 (Reuters) – CMA CGM said on Friday geopolitical and economic risks clouded its outlook despite a further rise in profits due to a saturated shipping market.

France’s CMA CGM, one of the world’s largest container lines, reported net profit of $7.2 billion for the first quarter, up from $2.1 billion a year earlier and also topping $6.7 billion recorded for the last quarter of 2021.

An economic rebound from the initial impact of the COVID-19 pandemic has pushed freight rates up and left shipping capacity to stretch.

In CMA CGM’s core shipping business, strong revenue per container again offset rising costs, including an almost 46% year-on-year increase in ship fuel expenses.

“Even if the Group remains confident about its financial performance outlook for 2022, the current environment and its medium and long-term consequences remain uncertain,” CMA CGM said in a statement.

Container volumes shipped by the group fell 2.8% year-on-year in the first quarter due to bottlenecks at ports and on land routes, it said.

Other container lines, including Maersk (MAERSKb.CO), suggested the market could normalize in the second half. Read more

CMA CGM, like other shipping companies, has suspended services to Ukraine and Russia due to Moscow’s invasion of its neighbor and related Western sanctions imposed on Russia.

CMA CGM, privately controlled by the Saade family, had limited business in Ukraine and Russia but warned the war could have global economic repercussions.

Like its maritime counterparts, the surge in profits enabled CMA CGM to increase its investments in non-maritime logistics.

The group last month announced an air cargo partnership with Air France-KLM (AIRF.PA) under which CMA CGM will become a reference shareholder in the airline. Read more

The Marseille group also announced a new order for 16 ships, including 10 powered by liquefied natural gas and 6 by methanol, bringing its number of ships on order to 69.

Reporting by Gus Trompiz Editing by Chizu Nomiyama

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