A.P. Moller - Maersk reports robust Q2 financial results in difficult market conditions

Copenhagen, Denmark – A.P. Moller – Maersk (Maersk) reports a second quarter of 2023 ahead of expectations, while the ongoing market normalisation continued through the quarter leading to lower volumes and lower rates. Revenue stood at USD 13.0bn compared to USD 21.7bn in Q2 2022 while profitability was strong at 12.4% although significantly lower compared to the extraordinarily strong Q2 2022. Reflecting the strong first half performance, Maersk raises its financial outlook and now expects underlying EBITDA of USD 9.5 - 11.0bn (previously USD 8.0 – 11.0bn), underlying EBIT of USD 3.5 - 5.0bn (previously USD 2.0 - 5.0bn) despite a weakened second half market outlook.

Ocean revenue decreased to USD 8.7bn from USD 17.4bn driven by a decrease in freight rates and loaded volumes. While the volume and rate environment stabilized at a lower level during Q2, Ocean continued to be impacted by lower demand, driven by a significant inventory correction in particular in North America and Europe. A strong cost management allowed to partially offset the top line impact on financial performance in Ocean.

Revenue in Logistics & Services was USD 3.4bn compared to USD 3.5bn. The segment was also impacted by lower volumes due to the continued destocking and weaker consumer demand, as well as low rates. As in Ocean, market demand is expected to continue to be subdued as long as the inventory correction is ongoing.

Revenue in Terminals decreased to USD 950m from USD 1.1bn and was influenced by the normalisation of storage revenue and lower volumes amid lower consumer demand and less congestion in North America. Strong cost control contributed to a continued solid financial performance.

Financial guidance for 2023

The inventory correction observed since Q4 2022 appears to be prolonged and is now expected to last through year end. Based on the continued destocking, A.P. Moller – Maersk now sees global container volume growth in the range of -4% to -1% compared to -2.5% to +0.5% previously. Ocean expects to grow in-line with the market.

For the full-year 2023, A.P. Moller – Maersk raises its financial guidance as seen in the table below.

A.P. Moller – Maersk now expects CAPEX to be at the lower end of the previously communicated ranges of USD 9.0 - 10bn for 2022-2023 and USD 10.0 - 11.0bn for 2023-2024.

Cash distribution to shareholders

A total distribution of cash to shareholders of USD 2.4bn took place during Q2 2023 through dividend withholding taxes paid of USD 1.5bn and share buy-backs of USD 868m.

Financial highlights

Highlights Q2

Revenue

EBITDA

EBIT

CAPEX

Sensitivity guidance

Financial performance for A.P. Moller - Maersk for 2023 depends on several factors subject to uncertainties related to the given uncertain macroeconomic conditions, bunker fuel prices and freight rates. All else being equal, the sensitivities for 2023 for four key assumptions are listed below:

About Maersk

A.P. Moller - Maersk is an integrated logistics company working to connect and simplify its customers’ supply chains. As a global leader in logistics services, the company operates in more than 130 countries and employs around 100,000 people. Maersk is aiming to reach net zero greenhouse gas (GHG) emissions by 2040 across the entire business with new technologies, new vessels, and reduced GHG emissions fuels.