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AP Møller-Maersk lifted its financial guidance for the third time since May as the world’s second-largest container shipping group benefits from continued supply chain disruption in the Red Sea and stronger global trade.
The Danish group on Thursday said it now expects operating profits for its full year to be between $3bn and $5bn, up from its previous forecast from June of $1bn to $3bn. In February it had forecast a loss of up to $5bn.
Maersk last raised its forecasts in June, as deepening delays and congestion in global supply chains led to a sharp increase in freight rates. It now expects container growth — a proxy for global trade — will increase by 4-6 per cent this year, up from an earlier forecast of 2.5-4.5 per cent.
Houthi rebels started attacks in the Red Sea at the end of last year, causing container shipping lines to take a longer and more expensive detour around the southern tip of Africa for routes between Asia and Europe.
Maersk initially thought the disruption from the Red Sea would only last a few months, but now believes it will last most of this year and perhaps into 2025.
Vincent Clerc, Maersk’s chief executive, told the Financial Times in June that there was a danger that retailers worried about getting Christmas goods could make the disruption worse by pushing their orders earlier. The current third quarter is normally the busiest for Christmas products for container shipping lines.
The Danish group provided little new information on the possible length of the Red Sea disruption on Thursday. It had first thought that a large number of new ships ordered by rivals would cause the supply-demand relationship to become skewed, hitting profitability in the second half.
Maersk said only that “trading conditions remain subject to higher than normal volatility given the unpredictability of the Red Sea situation and the lack of clarity of supply and demand in the fourth quarter”.
In its trading update on Thursday, the company said revenues fell by about 2 per cent to $12.8bn in its second quarter, while operating profits declined by 40 per cent to $963mn.
Further disruption could come later this year with some industry figures worried about how a possible return to the US presidency of Donald Trump could distort global trade, particularly if shippers try to move extra goods ahead of expected tariffs on China.
Short-term rates for container shipping have fallen from their peaks in recent weeks, possibly suggesting that some of the pressure from early Christmas ordering has started to ease.
Shares in Maersk initially rose on the new guidance but were trading down 0.5 per cent on Thursday afternoon.
