A.P. Moeller-Maersk (Maersk) has increased its original volume forecast for the second quarter of 2020, suggesting it could drop by 15-18% instead of a previously predicted decline of 20-25%.
In a statement, Maersk said it will still suspend releasing guidance on potential full-year earnings due to the uncertainty brought about by the COVID-19 pandemic.
However, it did suggest that, as well as its better than expected volume, it predicted its earnings before interest, taxes, depreciation and amortization (EBITDA) would be slightly higher than the $1.5 billion it made in the first quarter of 2020.
Søren Skou, CEO of A.P. Moller – Maersk had this to say: “Despite an expected 15-18 pct. drop in demand due to COVID-19 during the second quarter, I am pleased that we expect to deliver operating earnings slightly above our operating earnings in the first quarter.
“This also means we expect operating earnings to be higher than they were in the same quarter last year.
“We have been able to navigate well in a very difficult second quarter, adjusting capacity to demand to maintain high utilization of our network and managing our cost across the company.
“This quarter follows a first quarter where we also delivered year-on-year earnings growth despite 5 pct. lower demand and sharply increasing fuel cost as a result of the switch to low sulphur fuel on 1 January.
“While uncertainty persist because of the pandemic and low visibility on the recovery path, we benefit from a more resilient Ocean-business.”
The pandemic has caused chaos across the shipping industry, with congestion at ports and increased blank sailings from carriers. The crash in volume has meant carriers have suspended guidance on full year earnings for 2020, with Hapag-Lloyd being the exception.