Maersk raises earning projection by $8.0bn in Q3
Shipping giant, Maersk is changing its full-year projection based on the preliminary third-quarter figures and the fourth-quarter outlook, the company said in a trading update.
The Chief Executive Officer of the company, Søren Skou, said the rise in the company’s earnings outlook for the year 2020 follows a recovery in demand as well as measures taken to reduce costs.
Skou said given the result in the third quarter and the current earnings momentum has seen across its businesses, the 2020 earnings before interest, taxes, depreciation, and amortization (EBITDA) is expected to be in the range of $7.5 and $8 billion.
Skou said the company reported unaudited revenue of $9.9billion and an EBITDA before restructuring and integration costs of $2.4billion for the third quarter, which is driven by a continued recovery in demand and the company’s cost-cutting measures.
He said volumes in the ocean declined by around three per cent in the third quarter of 2020 compared to the previous year, which is slightly better than the anticipated mid-single-digit contraction.
He said the company expects to take a restructuring charge of around $100 million in the third quarter related to redundancies of around 2,000 employees, as the consequence of the changes to the organisation in ocean and logistics, services announced on September 1, 2020.
“Maersk is on track to deliver a strong third quarter with solid earnings growth across all our businesses, in particular in the ocean, logistics, and services. Volumes have rebounded faster than expected, our cost has remained well under control, freight rates have increased due to strong demand and we are growing earnings rapidly in logistics and services,” he said.
He said the outlook for the fourth quarter is solid for the same reasons, as the company can upgrade its expectations for the full year.
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