Copenhagen, Denmark – A.P. Moller – Maersk (Maersk) has reported its first-quarter results, aligning with market expectations and showcasing a robust recovery in earnings compared to the final quarter of 2023. The company attributes these results to a strong performance in Terminals and the confluence of heightened demand coupled with persistent disruptions in the Red Sea. Given the anticipation of these conditions persisting well into the latter half of the year, Maersk has revised its guidance range, now anticipating underlying EBIT to range between USD -2.0 to 0.0 billion.
Vincent Clerc, CEO of Maersk, expressed satisfaction with the company’s performance, stating, “We had a positive start to the year with a first quarter developing precisely as we expected.” He highlighted the escalating demand and ongoing challenges in the Red Sea as key factors driving the company’s outlook for the upcoming quarters. However, Clerc also cautioned against the potential pressure on ocean markets due to the influx of new vessels expected to be delivered in the coming years. To counter this, Maersk remains steadfast in its commitment to cost management, aiming to mitigate disruptions and bolster margins across its operations.
The Ocean division witnessed the ramifications of the Red Sea situation, with market rates and costs being affected by supply chain disruptions. Nevertheless, strong volumes, optimal capacity utilization, and disciplined cost management led to improved results compared to the previous quarter. In Logistics & Services, while significant volume growth was recorded, margins were deemed unsatisfactory due to low utilization in certain warehouses and short-term challenges in implementing new customer contracts in the ground freight business, particularly in North America. Terminals, on the other hand, kicked off the year on a high note, with robust results driven by volume growth and effective cost management.
In line with its strategic focus on end-to-end logistics, Maersk completed the spin-off of Svitzer, a move aimed at streamlining its portfolio. The demerger, approved by an Extraordinary General Meeting on April 26th and finalized on April 30th, has resulted in Svitzer Group A/S being listed on the Nasdaq Copenhagen.
Looking ahead to the remainder of 2024, Maersk has adjusted its financial guidance upward, reflecting strong market demand and container volume growth expected to align with the upper end of the 2.5-4.5% range. Despite the looming challenge of oversupply, exacerbated by delayed impacts, Maersk remains optimistic about navigating the evolving market dynamics.
