A.P. MOLLER – MAERSK says it continued to build momentum in 2Q 2024, reporting volume growth across all segments and improved financial performance with EBIT margin reaching 7.5% compared to 1.4% in the first quarter.
Results were driven by increased profitability in Ocean, solid growth in Logistics & Services and excellent performance in Terminals, the Group said.
Based on the prolonging of the crisis in the Red Sea and a continued robust market demand, Maersk upgraded its guidance for 2024 on 1 August and now expects global container market growth to be between 4-6% and to grow in line with the market compared to the previous expectations of towards the upper end of 2.5-4.5%; accordingly full-year EBITDA and EBIT expectations have risen from $7bn to US$9 billion to $9bn-11bn; and US$1-3bn to $3-5bn, respectively.
“Our results this quarter confirm that performance in all our businesses is trending in the right direction. Market demand has been strong, and as we have all seen, the situation in the Red Sea remains entrenched, which leads to continued pressure on global supply chains,” CEO Vincent Clerc said.
“These conditions are now expected to continue for the remainder of the year. We have invested in additional equipment in all our businesses to adapt to the situation and continue supporting our customers through the disruptions.
“As we look ahead, our focus remains on leveraging organic growth while exploring opportunities for value-accretive acquisitions particularly in Logistics. We will maintain tight cost control and high asset utilization, and further execute on our fleet renewal program,” Mr Clerc said.
Ocean saw strong volume growth and higher freight rates, primarily in Asia exports, reflecting the increased supply chain pressure, while the situation in the Red Sea and rerouting south of Cape of Good Hope continued to lead to higher operating costs.
Profitability returned to positive territory, and while below the same quarter last year, performance was significantly better compared to Q1 2024 and Q4 2023.
Logistics & Services grew by 7% compared to the year prior and increased volumes across all product families more than offset low rates. Profitability improved both sequentially and year on year, positively impacted by increased asset utilization, good cost control, and progress on initiatives to address customer implementation challenges in the ground freight business in North America, Maersk reported.
“Terminals continued to deliver volume growth, particularly in North America. Revenue per move increased significantly due to higher tariffs and higher storage, while cost per move increased slightly. Effective cost management and robust revenue growth supported profitability, leading to one of the highest EBITDA levels ever,” the Group said.
Maersk has raised its CAPEX projection for 2024-25, now expected to be between US$10.0 -11.0bn (previously US$9.0-10.0bn) “due to continuous fleet renewal”.
