Join our crew and become one of the 105,000 members that receive our newsletter.

Soeren Skou, CEO Maersk

Maersk Forecasts A Return To Pre-COVID Container Demand In 2021

Reuters
Total Views: 85
August 19, 2020

Soeren Skou, CEO of AP Moeller – Maersk A/S, holds a news conference on the group’s second quarter results, in Copenhagen, Denmark, August 19, 2020. Ritzau Scanpix/Martin Sylvest via REUTERS

by Jacob Gronholt-Pedersen (Reuters) – Shipping group Maersk on Wednesday issued full-year earnings guidance above its forecast at the beginning of the year and said it expects demand for moving containers at sea to return to pre-COVID levels in the first half of next year.

The company’s share price jumped more than 7% in early trade to an eight-month high, and has doubled in value since March, as cost cuts and the prospect of a global economic recovery outweighed the present impact of the coronavirus pandemic.

“Our expectation is that some time during the first half next year we will have volumes back at the level we had in 2019,” Chief Executive Soren Skou told a press conference.

Maersk, which handles one in every five containers shipped by sea worldwide, posted second-quarter revenue and earnings above expectations, as a sharp drop in volumes was partly offset by higher freight rates, lower fuel prices and lower costs.

“With a strong result and a strong balance sheet we are well positioned to financially and strategically come out stronger of the crisis,” Skou said.

Maersk, which had in March suspended its earnings guidance because of coronavirus-related uncertainties, said it expected full-year core earnings (EBITDA) of between $6 billion and $7 billion before restructuring and integration costs.

That compares with the $5.5 billion it forecast at the beginning of the year.

“Maersk has delivered an extraordinarily good report,” Alm. Brand Chief Equity Analyst Michael Friis Jorgensen said. “The market is refraining from competing on price, and internally Maersk has been phenomenal in adapting to the new situation by cutting costs.”

Global demand for containers is still forecast to fall this year compared with last year, with a decline of 20% at the depth of the crisis in April set to improve to a 4%-6% contraction in the third quarter, Maersk said.

EBITDA rose 25% to $1.7 billion in the second quarter, above the $1.6 billion forecast by analysts in a Refinitiv poll, on revenue down 7% at $9.0 billion versus an expected $8.9 billion.

($1 = 6.2376 Danish crowns)

Additional reporting by Terje Solsvik; Editing by David Evans and David Holmes

Weekly Insights from the Helm

Dive into a sea of information with our meticulously curated weekly “Dispatch” email. It’s more than just a newsletter; it’s your personal maritime briefing.

Sign Up
Back to Main
polygon icon polygon icon

Why Join gCaptain Club?

Be Informed: Stay updated with the latest maritime news and trends.

Connect: Network with a community of maritime professionals and enthusiasts.

Gain Insights: Receive exclusive content and personal perspectives from our CEO.

Sign Up
close

JOIN OUR CREW

Maritime and offshore news trusted by our 105,000 members delivered daily straight to your inbox.

Join Our Crew

Join the 105,000 members that receive our newsletter.