CEVA Logistics Implements Turnaround Plan
Following the friendly takeover bid for CEVA Logistics, the CMA CGM Group has implemented a turnaround plan which includes a new governance, a new brand identity and priorities reset. CEVA’s new operations center opened in Marseilles.
The CMA CGM Group now holds 99.6% of CEVA's equity. Structural decisions have been made during the second quarter of 2019 to enable CEVA’s financial recovery and create the conditions of a solid and successful turnaround.
Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, was elected Chairman of the Board of Directors of CEVA Logistics at the Annual General Shareholders Meeting held on 29 April 2019.
A new, stronger governance structure has been put in place. Nicolas Sartini became Chief Executive Officer as of 1 June 2019, and was tasked with implementing CEVA's turnaround plan and returning it to profitability.
CMA CGM has been proceeding with the squeeze out procedure and filed the claim for cancellation of the remaining outstanding CEVA shares, with completion expected in the third quarter of 2019.
CEVA’s operations center opened on 25 June in Marseilles, bringing together CEVA's management teams and support functions, for a total of 200 employees (new jobs and transfers). Located near the Group's head office, it will strengthen the operational management and control of CEVA.
A new brand identity for CEVA has been unveiled in July, expressing the new brand ambition.
Through a collaborative approach with customers, the objective is to unite the strengths of both CEVA and CMA CGM, develop a full understanding of the customer supply chain, use the most up-to-date technologies and best practices to optimize services and cost in storage and transportation, as well as create responsive and tailor-made solutions for all customers. This ambition is embodied in a new image and a new, modern visual identity.
The new management team is focusing on top line improvement with stronger business development structures and stronger contractual protections, a quicker resolution of situations currently holding back Company performance: under-performing contracts in Contract Logistics, including Italy, Ground operations, notably in North America, quicker roll-out of technology both in Freight Management and Contract Logistics in order to achieve more automated processes and better standardization.
Finally, actions are underway to reinforce internal processes, more systematic sharing of best practices, performance measurement tools and employee engagement with the objective of higher retention.
“CEVA went through significant and structural changes in the first half of 2019 against a challenging macroeconomic backdrop. We are currently focusing on the turnaround of the Company through deep operational changes and on achieving positive free cash flow as early as the fourth quarter 2019," says Nicolas Sartini, CEO of CEVA Logistics.
Management’s expectations remain that 2019 will see progress in line with the 2021 objectives, including improvement in net profit and in free cash flow. Free cash flow is expected to turn positive in the fourth quarter of 2019.