Maersk warns of slower demand for container shipping By Reuters

© Reuters. FILE PHOTO-Signage is seen on the Maersk workplaces in Copenhagen, Denmark, July 30, 2022. REUTERS/Andrew Kelly/File Picture

By Jacob Gronholt-Pedersen

COPENHAGEN (Reuters) -Transport group A.P. Moller-Maersk warned on Friday of a steeper decline in international demand for transport containers by sea this 12 months prompted by muted financial development and clients decreasing inventories.

The corporate, one of many world’s largest container shippers with a market share of round 17%, mentioned it expects container volumes to fall by as a lot as 4%. It had beforehand forecast a decline of not more than 2.5%.

Maersk, one of many world’s largest container shippers with a market share of round 17%, transports items for retailers and client corporations corresponding to Walmart (NYSE:), Nike (NYSE:) and Unilever (NYSE:).

“Maersk proceed to anticipate muted international macro-economic development given continued strain from larger rates of interest and potential recessionary danger in Europe and america,” the corporate mentioned in a press release.

Maersk posted report earnings final 12 months because of excessive freight charges attributable to excessive client demand and pandemic-related log jams at ports. However freight charges have tumbled this 12 months amid a worldwide financial slowdown.

The corporate on Friday posted second-quarter earnings above expectations and narrowed its revenue forecast for the 12 months.

Earnings earlier than curiosity, tax, depreciation and amortisation (EBITDA) fell to $2.91 billion within the quarter from $10.3 billion a 12 months earlier, beating analysts’ expectations of $2.41 billion in a Refinitiv ballot. Revenues fell 40% to $13.0 billion.

It now expects underlying EBITDA between $9.5 billion and $11 billion. It had beforehand predicted an underlying EBITDA of between $8 billion and $11 billion.

The corporate mentioned the variety of containers it loaded onto ships between April and June fell by 6% from a 12 months earlier, whereas common freight charges halved.

“The second-quarter end result contributed to a robust first half of the 12 months, the place we responded to sharp modifications in market circumstances prompted by destocking and subdued development atmosphere following the pandemic fuelled years,” Chief Government Vincent Clerc mentioned in a press release.