CEVA Logistics has announced preliminary results for Q2, 2018 in the context of its ongoing refinancing. These preliminary results are based on internal management accounts and reflect CEVA's preliminary expectations for its results for the period. The preliminary results have not been reviewed or audited by CEVA's independent auditor. The publication of full financial results for Q2, 2018 has been brought forward; results will now be released on 27 July 2018.
The business has continued to perform well in the second quarter ended 30 June 2018. CEVA expect revenue growth of approximately 7.3% versus the prior year comparable period for the Group, with revenue increasing approximately 5.1% in constant currency. Freight Management revenue growth is estimated at approximately 5.4% while revenue growth in Contract Logistics has accelerated to approximately 4.7%, both in constant currency. Major industry sectors, including automotive, continue to exhibit good growth.
The Company anticipate Adjusted EBITDA for Q2 to be approximately US$77.0 million, an increase of approximately US$7.0 million over the prior year comparable period. This represents an EBITDA margin of approximately 3.6%, up approximately 30 bps year on year in constant currency. CEVA has made progress in productivity, cost reduction and other margin improvement initiatives.
For the first six months of 2018, Adjusted EBITDA is expected to be approximately US$143.0 million, US$19.0 million higher year on year, with revenue growth of approximately 5.2% in constant currency.
The Company expect net capex to be approximately US$47.0 million for the first six months of 2018 compared to US$48.0 million in the prior year comparable period. Net debt as of 30 June 2018 is anticipated to be approximately US$1,132.0 million compared to US$2,228.0 million as of 31 March 2018.
CEVA has experienced limited impact on volumes from tariffs to date. Actually, it has seen an acceleration of air volume growth in recent weeks. The Company’s ongoing cost reduction initiatives are expected to help it minimise any potential impact from tariffs.
As part of its previously announced refinancing of the majority of its existing debt facilities, CEVA has announced the launch of a private offering of €300.0 million of senior secured notes due 2025. This follows the prior launch of a private offering of US$400.0 million of secured term loan due 2025 and a US$600.0 million new Revolving Credit and Ancillary Facility due 2023. Subject to market conditions, the refinancing is expected to complete early August.