A.P. Moeller-Maersk A/S reinstated full-year guidance after posting better-than-expected second-quarter earnings as higher freight rates, lower fuel prices and cost cuts helped offset a slump in demand from the Covid-19 pandemic.
The Danish shipping company Wednesday posted a quarterly net profit of $427 million from $141 million a year earlier, beating a $281 million average analysts’ forecast from FactSet.
Revenue fell 6.5% to $9.0 billion, compared with an expected $8.77 billion, while earnings before interest, tax, depreciation and amortization of $1.7 billion beat Maersk’s own guidance of slightly above $1.5 billion.
Maersk, which is considered a barometer of global trade, saw shipping volumes fall 16%, while average freight rates fell 4.5% on year. The company had guided for a 15%-18% volume drop.
Global container trade declined by around 10% in the second quarter and Maersk said that although container demand is expected to gradually improve sequentially in the third quarter, it will significantly decline in 2020 as a whole compared with 2019.
Maersk reinstated guidance Wednesday, expecting to see 2020 pre-items Ebitda of between $6 billion and $7 billion, higher than original guidance of around $5.5 billion.
Organic volume growth in its ocean unit is expected to be in line with or slightly lower than the average market growth.
Capital expenditure for 2020-21 is seen at $3 billion to $4 billion.
Write to Dominic Chopping at [email protected]
