A.P. Moller – Maersk (Maersk) has reported record earnings in Q3 2021 with revenue growing 68% to $16.6 billion, EBITDA tripled to $6.9 billion and return on invested capital (ROIC) increased to 34.5% for the past 12 months.
For ocean freight, results in this quarter were driven by high freight rates in an exceptional market situation as revenue almost doubled to $13.1 billion from $7.1 billion, EBITDA increase by $4.4 billion to $6.3 billion and EBIT improved by $4.4 billion to $5.3 billion.
Additionally, to further guarantee reliable transportation, the share of long-term contracts was further increased as it now accounts for 64% of long-haul volumes compared to 50% in 2020.
Driven by strong activity across all products and strong commercial synergies, logistics and services continued its positive momentum as revenue increased 38% to $2.6 billion whereof 33% was organic. EBIT also increased to $194 million from $100 million in the same quarter last year, and with an EBIT margin of 7.5%, well ahead of Maersk’s mid-term target of above 6%.
Lastly, gateway terminals also showed a strong Q3 with revenue growing to $1 billion from $816 million in the same period the previous year, as volumes increased by 9.6% mainly coming from North America, Latin America, and Asia. Overall, terminals achieved an ROIC of 10%.
“In the ongoing exceptional market situation, with high demand in the US and global disruptions to the supply chains, we continued to increase capacity and expand our offerings to keep cargo moving for our customers,” said Søren Skou, CEO of A.P. Moller – Maersk.
“Our integrator strategy is key to supporting our customers’ stable end-to-end logistics needs by designing a more stable ocean business, strongly growing our logistics offering and relying on automated and efficient terminals.”
In a statement from Maersk, it revealed its ocean sector is now expected to grow below the global container demand, which is now expected to grow 7-9% in 2021, subject to high uncertainties due to the ongoing congestion crisis.
Current trading conditions are subject to a higher-than-normal uncertainty due to the temporary nature of current demand patterns and disruptions in the supply chains. These conditions are expected to continue at least into the first quarter of 2022.
Other highlights noted by the company through Q3 2021 included it acquiring Portuguese cloud-based logistics start-up HUUB in September, as well Senator International, pending regulatory approvals, in order to significantly increase its air freight activities.
Maersk also recently released its October 2021 market update where it revealed that container demand growth has moderated to 2.5% in Q3 year-on-year, down from the double digital growth rates in H1 2021. This is due to disruptions caused by COVID-19 and capacity shortages which has resulted in equipment shortages and supply chain management services.