Maersk Retains Growth Momentum in Second Quarter of 2024

A.P. Moller - Maersk continued to build momentum in the second quarter reporting volume growth across all segments and improved financial performance with EBIT margin reaching 7.5% compared to 1.4% in the first quarter.

Results were driven by increased profitability in Ocean, solid growth in Logistics & Services and excellent performance in Terminals. Based on the prolonging of the crisis in the Red Sea and a continued robust market demand, Maersk upgraded its guidance for 2024 on August 1st.

Vincent Clerc, CEO at Maersk said: “Our results this quarter confirm that performance in all our businesses is trending in the right direction.

"Market demand has been strong, and as we have all seen, the situation in the Red Sea remains entrenched, which leads to continued pressure on global supply chains. These conditions are now expected to continue for the remainder of the year.

Maersk Air Cargo Takes Delivery of its First Boeing 777 Freighter

"We have invested in additional equipment in all our businesses to adapt to the situation and continue supporting our customers through the disruptions.

"As we look ahead, our focus remains on leveraging organic growth while exploring opportunities for value-accretive acquisitions, particularly in Logistics. We will maintain tight cost control and high asset utilisation and further execute on our fleet renewal program.”

Ocean saw strong volume growth and higher freight rates, primarily in Asia exports, reflecting the increased supply chain pressure, while the situation in the Red Sea and rerouting south of Cape of Good Hope continued to lead to higher operating costs.

Profitability returned to positive territory, and while below the same quarter last year, performance was significantly better compared to Q1 2024 and Q4 2023.

Logistics & Services grew by 7% compared to the year prior and increased volumes across all product families more than offset low rates.

Profitability improved both sequentially and year on year, positively impacted by increased asset utilization, good cost control, and progress on initiatives to address customer implementation challenges in the ground freight business in North America.

Terminals continued to deliver volume growth, particularly in North America. Revenue per move increased significantly due to higher tariffs and higher storage, while cost per move increased slightly.

Effective cost management and robust revenue growth supported profitability, leading to one of the highest EBITDA levels ever.

Financial guidance for 2024

As announced on August 1st, due to continued supply chain disruptions caused by the ongoing situation in the Red Sea/Gulf of Aden and robust container market demand, Maersk raises its financial guidance as seen in the table below.

Maersk now expects global container market growth to be between 4-6% and to grow in line with the market compared to the previous expectations of towards the upper end of 2.5-4.5%.

In addition, Maersk now expects CAPEX to be between US$10 to 11 billion for 2024-2025 (previously US$9 to 10 billion) due to continuous fleet renewal.

Read More: Maersk Q1 Results in Line with Expectations Amid Ongoing Red Sea Crisis