Congestion boosts Maersk’s operating profit outlook to $31 billion

Congestion boosts Maersk’s profits expectations to record $31 billion

A.P. Møller – Mærsk A/S (Maersk) has raised financial expectations for its second quarter of 2022 as higher freight rates lingered due to continued congestion across the global supply chain.

Port congestion globally is continuing to be exacerbated by labour shortages, strikes, and inland logistics capacity, driving major carriers’ boom profits as freight rates remain at record levels.

READ: Strike action, inland capacity stymies global port productivity

Maersk is no exception and anticipates a revenue of $21.7 billion, with underlying EBITDA of $10.3 billion and an underlying operating profit (EBIT) of $8.9 billion.

The company shared that the strong result is also driven by the continuation of the exceptional market situation within its Ocean business arm.

As reported by expert Lars Jensen on LinkedIn, despite downward trends in the market, the “reality is that whilst spot rates are declining, contract rates for 2022 are substantially higher than for 2021”.

Therefore, Maersk’s has revised its full year guidance for 2022 with underlying EBITDA now expected to be around $37 billion (previously around $30 billion) and underlying EBIT expected around $31 billion (previously around $24 billion).

The free cash flow (FCF) for the full-year 2022 is now expected to be above $24 billion (previously above $19 billion), while the cumulative capex guidance for 2022-23 is unchanged at $9-10 billion.

The guidance is based on a forecasted gradual normalisation in ocean container shipping in the fourth quarter of this year.

Maersk said it will publish its Q2 result on 3 August. 

In the first quarter of the year, Maersk posted revenues of $19.3 billion.

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