Maersk says booming container market to boost profit by 25%

Bloomberg

AP Moller-Maersk A/S said the booming container market will normalize later than the transport giant previously expected, leading to a 25% boost in full-year operating profit.
Lower volumes are pushing up the price of shipping containers for longer than previously foreseen, Maersk said, forecasting a 2022 profit of about $30 billion, measured as underlying earnings before interest, tax, depreciation and amortisation (Ebitda), according to a statement on Tuesday. That’s up from the $24 billion Maersk predicted in February and compares with an average estimate of $28.3 billion in a survey by Bloomberg.
Maersk shares rise 9% in Copenhagen shortly after the open. The gain pared the year-to-date decline to about 16%. Maersk shares have more than doubled in value over the two-year period of 2020-2021.
The company said that results were driven by an “exceptional market situation” with high freight rates continuing into the second quarter. The company, which transports about one-sixth of the world’s containers, sees the market normalising early in second half of the year.
Kuehne + Nagel International AG also on Tuesday indicated that trade bottlenecks would last longer as the freight-forwarder reported that “the already strained supply-chain situation deteriorated further” in the first three months of the year. The Swiss company published first-quarter earnings that beat estimates.
The disruption allowed container lines to charge 71% higher rates than a year earlier, Maersk said. It now sees a risk of the global container market contracting this year, forecasting worldwide demand to decline 1% or rise 1%, compared with a previous forecast of 2% to 4% growth.
Maersk is due to report its first-quarter results on May 4.