Maersk’s good tidings hint at longer supply misery
A.P. Moller-Maersk’s rosy shipping forecast portends prolonged misery for global supply chains. The $56 billion Danish firm said maersk-presents-a-record-q3 on Tuesday that its EBITDA jumped to nearly $7 billion in the three months to the end of September, three times last year’s outcome despite lower container volumes in ports. More importantly, Chief Executive Soren Skou reckons the surge in demand for containers will last at least until the first quarter of next year, dashing hopes that the logistics crunch will be fixed by Christmas.
Logjammed ports should in theory mean lower sales for a company like Maersk. But thanks to relatively static costs and retail giants like Amazon.com absorbing elevated prices for freight containers, Skou delivered a whopping 41% EBITDA margin in the third quarter. As a result, Maersk’s share price has almost doubled since the beginning of 2020. Skou’s clients may now have to endure the pain of higher shipping costs for at least six more months. He, on the other hand, remains on the crest of a wave. (By Aimee Donnellan)
Source: Reuters (Editing by Ed Cropley and Oliver Taslic)