Back in Dec 2021, I had suggested ZIM Integrated Shipping (ZIM) as a 2022 Ho Ho Hohum pick
The company announced Q4 results today (03/09/22)
One word - Wow!
I had expected a nice Q4 dividend. Instead I get a $17/sh dividend on a $70-ish stock
- $4.65B Net income for the full year of 2021
- Announced leases for 36 new vessels delivering in 2023-2024
- Company has paid down LT debt significantly. However, of the major liner companies, ZIM has the highest % of leased vessels. Lease obligations is the item to watch
- Subsequent to Q4 2021, ZIM announced an extension to agreement with 2M alliance (That’s #1 MSC and #2 Maersk)
The prior warning repeated. ZIM is an Israel based company and there is a significant tax withholding on dividends. This makes ZIM a not-so-great idea in IRA-type accounts. Though I took a small hit in prior ZIM payouts, I will be avoiding the same outcome with my ZIM shares held in tax advantaged accounts this time. My other ZIM shares (taxable ac) I will most likely let ride.
I don’t think the container shipping issues get resolved in 2022. And 2023 is the start of emissions standards (which impacts the vessel supply side more).