A.P. Moller – Maersk (Maersk) has made an “exceptionally strong start” to 2021 after its earnings grew in all segments in Q1 2021, including Ocean, Port Services and Logistics.
Its earnings before interest, taxes, depreciation and amortisation (EBITDA) in Q1 were $4 billion, up from $1.5 billion Q1 2020. Revenues were also up, this time reaching $9.5 billion from the $7.2 billion it made 12 months ago.
Container volumes increased by 5.7% and freight rates by 35%, which combined with lower bunkering costs to mean its ocean segment earned $3.4 billion, up from $1.2 billion in 2020.
One of the biggest growth areas was its Logistics and Services segment, where earnings increased by 42% year-on-year (YoY), mainly driven by organic growth and also the acquisitions of Performance Team and KGH Customs Services.
Gateway Terminals also saw strong growth and rose by 52% YoY, led by higher volumes and storage income.
Soren Skou, Maersk’s CEO, said the figures represented a record for quarterly figures.
“The high growth and profitability were driven by solid demand across Ocean, Logistics and Terminals,” he said.
“Strong demand led to bottlenecks and a lack of capacity and equipment, which drove up freight rates to record-high levels.
“We have continued to dedicate significant efforts to the safety of our employees and contribute to the societies we operate in, this quarter with a particular emphasis on India. Overall, we can be very satisfied with how the business performed this quarter.”
Maersk attributed the results to high freight rates, which were driven by strong consumer demand, a lack of capacity and a shortage of equipment of container handling equipment.
Additionally, it said consumer demand for integrated supply chains and self-service solutions has never been greater and this will provide momentum for logistics and digital solutions.
Upgrading its business model from a mere carrier of containers to a provider of end-to-end solutions has been Maersk’s biggest strategy over recent years.
In an online post, industry expert Lars Jensen noted that despite Maersk’s strong performance overall, its market share in the Ocean segment has decreased, and its growth in this in this area is behind the market average of 8%.
Carriers across the world have enjoyed strong profits amid the COVID-19 pandemic, benefitting from the aforementioned high consumer demand and freight rates.
