The largest shipping enterprise in the world, Denmark’s A.P. Moller-Maersk, announced a steady rise in earnings. This was declared on Tuesday during ongoing demand for shipments of goods worldwide.
The company announced that revenue increased approximately 68% during the third quarter to $16.6 billion. This was a sharp increase from $9.9 billion recorded in the same three-month period in 2020. It also observed profits of $5.5 billion up from $947 million in the same period last year.
Soren Skou, the company’s CEO, has said that even during the ongoing crisis, with high demand in the US and worldwide supply chain disruptions, the company has strived to expand capacity and offerings to have the cargo moving for consumers.
The immediate need for increasing shipping capacity arises amid towering consumer demand for all things from furniture to cars in the rebounding economy. The result is backups at major ports and sky-high prices. The supply chain issues have brought about a shortage of shipping containers.
In its statement, Maersk has reportedly said that its key ocean business is expected to grow below the container demand even during uncertainties resulting from supply chain logjams.
The company has also expressed the aspirations of acquiring Senator International, a global freight forwarding major with exclusive offerings. It also wishes to expand its air network and is adding the following to operations: three leased cargo planes expected to start operating from 20220 and two Boeing aircraft expected to get deployed by 2024.
In the ongoing exceptional market situation, with high demand in the US and global disruptions to the supply chains, we continued to increase capacity and expand our offerings to keep cargo moving for our customers. Our integrator strategy is key to supporting our customers’ end to end logistics needs by designing a more stable Ocean business, strongly growing our logistics offering and relying on automated and efficient terminals.
CEO of A.P. Moller – Maersk
Logistics & Services continued the positive momentum with revenue increasing 38 pct. to USD 2.6bn whereof 33 pct. was organic. The growth was driven by strong activity increase across all products and strong commercial synergies to Top 200 Ocean customers. EBIT increased to USD 194m from USD 100m in same quarter last year and with an EBIT margin of 7.5 pct. well ahead of our mid-term target of above 6 pct.
Gateway Terminals also had a strong Q3 with revenue growing to USD 1bn in Q3 from USD 816m last year as volumes increased by 9.6 pct. mainly coming from North America, Latin America and Asia as opening times were expanded and capacity utilization increased. Together with underlying efficiency improvements Terminals achieved a ROIC of 10 pct.
As a natural next step in expanding our multi logistics offering we today announce the acquisition of SENATOR INTERNATIONAL and the ordering of additional aircraft, building on our existing Air Freight capabilities and adding even more flexibility to our customers’ supply chains. Given the significant progress of our transformation into a logistics integrator and the continued commitment to shareholder returns, the Board of Directors has decided to extend the current share buy-back programme by an additional USD 5bn over the years 2024 and 2025.
CEO of A.P. Moller – Maersk
A.P. Moller – Maersk reiterates the guidance for the full-year as announced on 16 September 2021 with an underlying EBITDA in the range of USD 22 – 23bn, an underlying EBIT in the range of USD 18 – 19bn and a free cash flow of minimum USD 14.5bn.
Ocean is now expected to grow below the global container demand, which is now expected to grow 7-9 pct. in 2021 (previously 6-8 pct. in 2021), subject to high uncertainties related to the current congestion and network disruption.
For 2021-2022, the expectation for the accumulated CAPEX remains unchanged at around USD 7bn.
The current trading conditions are still subject to a higher-than-normal uncertainty due to the temporary nature of current demand patterns, disruptions in the supply chains. However, current conditions are expected to continue at least into the first quarter of 2022, resulting in an EBITDA for Q1 2022 in line with Q4 2021.