UnderTheBalanceSheet

$ZIM operates across five distinct Geographic Trade Zones: - Pacific - Cross-Suez - Atlantic-Europe - Intra-Asia - Latin America ZIM calls at over 300 ports in more than 100 countries. Given that ZIM accounts for 2%–2.5% of global market share, its Israeli operations represent only a minor fraction of its total global activity. While ZIM’s routes pass through Israel only within two specific zones, Cross-Suez and Atlantic-Europe it should be noted that a substantial portion of the activity within these zones does not involve Israel at all. The company does not disclose the specific percentage of volume or revenue originating from, or passing through, Israeli ports within these segments. Trade Zone Definitions: Cross-Suez: Covers all major international shipping ports in the East Mediterranean, the Black Sea, China, East and Southeast Asia, and India. Atlantic-Europe: Covers major international shipping ports in the East and West Mediterranean, the Black Sea, Northern Europe, the Caribbean, the Gulf of Mexico, and the East and West coasts of North America. Attached Data: - Percentage of total TEUs carried for the period. - Percentage of total freight revenues from containerized cargo. It is difficult to ignore the potential conflict of interest and the suspicion of financial arrangements between the management team whose MBO proposal was rejected and the union.

"The two new directors are expected to join the board only after the sale process concludes, which may explain why the existing board, led by Seroussi, ultimately did not object to their appointment." $ZIM 🤔

$ZIM ATLAS (Seaspan) is a public company, otherwise, this information likely would never have been disclosed in ZIM's reports (or perhaps only after activist shareholder action). As expected, ZIM does not share these details with its investors. One has to wonder why. 25 LNG Vessels: - 10 vessels: 15,000 TEU - 15 vessels: 7,700 TEU The two most significant costs in the Cost per TEU are: - The energy cost - The vessel cost (charter/ownership cost) These NEWBUILDS - DUAL FUEL LNG vessels offer tremendous energy savings relative to the industry. They are also the least exposed to IMO fines. And now you find that, in ZIM's case, they are also chartered at a much lower price than same sized vessels in the industry. Terms: A 12-year charter with purchase options for all 25 vessels. At what price? They didn't provide the details only hints that the options are deep in the money. How deep? Why would they withhold the details? Uncertainty ---> resulting in a low share price. The Vessels: 15 vessels listed as 7,000 TEU (though according to their specs, they are 7,700 TEU). This appears differently across various sources: 7,000 / 7,700 / 8,000. According to the specs, the capacity is 7,700 TEU. The Charter Contracts: The contracts are for 12 years with 2 options: Purchase: To acquire the vessel 9.5 years after delivery (approx. 8 years remaining). Extension: To extend the charter contract by two years for the 15,000 TEU vessels, and by 1.5 years for the 7,700 TEU vessels. Both options are deep in the money, and ZIM will have to decide which one to exercise. Daily Charter Rates by Type: For the 15,000 TEU vessel: Charter cost is ~$46,575/day. (10 such vessels = 150,000 TEU total capacity). For the 7,700 TEU vessel: Charter cost is ~$34,246/day. (15 such vessels = 115,500 TEU total capacity). Do your own market checks. However, pay attention to two significant parameters: 1. These are NEWBUILDS 2. These are DUAL FUEL LNG vessels After running your checks, note that the ROU asset regarding these very cheap charters cannot actually be revalued. however, it would be appropriate for the company to provide a Mark to Market disclosure for such a material asset. Consider how heavily these deals "weigh" on the company, as its long term charters are counted as debt on the balance sheet. Currently, they constitute the majority of the company's lease liability. Since the market counts them as debt, management leverages IFRS 16 to present this as "Net Debt," unlike its past presentation format (as shown in a previous post, attached in the comments). Thought we were done? Just wait. ZIM has previously noted the Down Payments for these vessels: For the 15,000 TEU vessels: The company paid $17M per vessel. For the 7,700 TEU vessels: The company paid $20M per vessel. Total Down Payments Paid: $490M (This is $20M higher than the raw calculation, likely due to slight cost adjustments). Now, pay attention to the following interesting point: This $0.5B sits on the balance sheet under ROU assets. It is not part of the daily payment the company actually pays out. There is an amortization of the ROU asset over the charter period on a straight-line basis [without cash outflow]. Therefore, these factors bolster the company's cash flow (adding to points I’ve mentioned before and some I haven't yet), causing it to exceed the company's accounting profit. This situation will intensify from quarter to quarter due to additional effects. We, of course, are interested in the real cash flow the company generates. Until Q3/24, these vessels had their own slide under "NEWBUILDS," which was naturally removed afterward. What happened in Q3/24? Kenon was still a shareholder and liquidated its holdings in December 2024. By the time the Q4/24 presentation was published, the MBO was reportedly already in significant planning stages. I'll leave you with a small riddle: At what vessel value was the deal done on its first day?