Maersk's Q2 profit soars 793pc to US$134 million as sales rise 0.6pc
DANISH shipping giant Maersk Group's second quarter net profit soared 793 per cent year on year to US$134 million, drawn on revenues of US$9
DANISH shipping giant Maersk Group's second quarter net profit soared 793 per cent year on year to US$134 million, drawn on revenues of US$9.63 billion, which rose 0.6 per cent.
'Q2 was a quarter of solid progress. EBITDA was up 17 per cent and cash flow improved 86 per cent year on year, driven by continued recovery in ocean,' said group CEO Soren Skou.
Maersk's ocean sector contributed $7.15 billion of the $9.63 billion total revenue, he said.
Maersk Line volume grew 1.4 per cent, to 6.9 million TEU (below the industry par of two per cent), mainly driven by a three per cent increase in backhaul liftings, which included a spike in demand for reefer goods in China.
But North American trades were impacted negatively by the trade restrictions with China.
'The organic volume growth in Ocean is still expected to be in line with the estimated market growth of 1-3 per cent for 2019,' said Mr Skou.
Average freight rates were up by 1.5 per cent, to $1,868 per FEU, with the east-west trades gaining 3.5 per cent and north-south routes up by just 1.3 per cent.
In its other sectors, turnover from logistics was flat, at $1.48 billion, but there was an impressive 13 per cent increase in revenue from terminal and towage to $957 million.
Mr Skou said the logistics sector had been 'positively impacted' by increased revenue from supply chain management, but hit by a decline in earnings from sea and air freight forwarding.
Volumes at APMT's gateway terminals were up 8.5 per cent on last year, to three million TEU, resulting in improved utilisation levels at its facilities.
Hapag-Lloyd also posted a positive Q2 result of $56 million. Interestingly, the German carrier's average rate came in at $1,071 per TEU, compared with Maersk's $934, noted London's Loadstar.
Analyst Lars Jensen said Maersk's Q2 results showed 'good progress - despite a challenging quarter for the industry'.
Said Mr Jensen: 'In terms of profitability, the ocean segment of the business saw an EBITDA margin of 14.9 per cent, which brings it back to the same level of performance in Hapag-Lloyd. It is also clear that the result is due to a strong focus on improving profitability on existing business rather than going for volume and market share.'