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A sail boat passes a Maersk container ship at the Port of Felixstowe Ltd. in Felixstowe, United Kingdom, September 15, 2021. /CFP
Shipping group A.P. Moller-Maersk warned on Wednesday that lower container volumes and freight rates would drive a four-fold plunge in profits this year, even as it reported record earnings for 2022.
The Copenhagen-based company, which transports goods for retailers and consumer companies such as Walmart, Nike and Unilever, raised its profit forecast twice last year as a surge in consumer demand and pandemic-related logjams at ports boosted freight rates.
But freight rates have since tumbled as recession looms and pandemic-fueled import bubbles deflate in the U.S. and other major consuming countries.
This year, Maersk expects global demand for shipping containers by sea to fall by as much as 2.5 percent as a buildup in inventories unwinds.
The company expects underlying earnings before interest, taxation, depreciation and amortization (EBITDA) of $8 billion to $11 billion in 2023, compared with $36.8 billion last year.
The forecast was below the $11.9 billion expected by analysts in a company poll.
"Guidance for 2023 is based on the expectation that inventory correction will be complete by the end of the first half, leading to a more balanced demand environment," it said.
(Source: Reuters with edits)
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Disinformation report hotline: 010-85061466