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Maersk Again Upgrades Full Year Guidance on ‘Exceptional Market Situation’

Mike Schuler
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August 2, 2021

A.P. Møller – Maersk has again upgraded its full-year 2021 guidance to reflect strong Q2 results and “an exceptional market situation,” the company said in a trading update.

Maersk on Monday reported preliminary unaudited revenue of $14.2 billion in Q2, an underlying EBITDA of $5.1 billion and an underlying EBIT of $4.1 billion for the quarter. Volumes in the company’s ocean segment increased by 15 percent and average freight rates improved 59 percent in Q2 2021 compared to previous year.

“The strong quarterly performance is mainly driven by the continuation of the exceptional market situation with strong rebound in demand causing bottlenecks in the supply chains and equipment shortage,’ the company said in the trading update.

Maersk said the situation in the market is still expected to continue at least through the end of the year, leading the company to upgrade its full year EBITDA guidance to $18-19.5 billion, up from its previous guidance of $13-15 billion, which it called for in April. Underlying EBIT is now expected in the range of $14-15.5 billion, up from $9-11 billion previously.

“As a consequence of the higher earnings expectations, and despite increasing net working capital and higher installments related to higher charter lease liabilities, the free cash flow (FCF) for the full-year 2021 is now expected to be minimum USD 11.5bn (previously minimum USD 7bn), while the cumulative CAPEX guidance for 2021-22 is unchanged of around USD 7bn,” Maersk’s trading update said.

“The outlook for the global market demand growth for the full-year 2021 has been revised up to 6-8% from previously 5-7%, primarily still driven by the export volumes out of China to the US,” the update said.

According to Maersk, earnings in the third quarter are now “expected to exceed the level for Q2 2021,” although are still subject to a “higher than normal volatility” due to the temporary nature of current demand patterns, disruptions in the supply chains and equipment shortages.

A.P. Møller – Maersk will publish its Q2 interim results on 6 August 2021.

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