A.P. Moller - Maersk ended 2020 with record Q4 results in logistics and terminals, while ocean delivered an exceptional quarter driven by the increased volumes and current, temporary supply chain disruptions.
That’s according to a statement released by the company today.
While low volumes persisted through most of 2020, profitability grew throughout the first nine months, resulting in the record results.
“2020 will forever be remembered for the Covid-19 pandemic that negatively impacted our lives, jobs, businesses and the global economy,” said Søren Skou, CEO of A.P. Moller - Maersk.
He added that the company had accelerated its transformation and delivered earnings growth during every quarter of 2020, despite very different market conditions, beginning with the negative Covid-19 impact in the first half to a rebound in Q4.
The company grew underlying earnings before interest, tax, depreciation and amortisation (Ebitda) 44% to US$ 8.2bn while revenue grew to US$ 39.7bn in 2020 compared to US$ 38.9bn in the previous year. He added that while the demand surge in the second half of the year had created supply chain bottlenecks, including vessel and container shortages, and had led to higher rates that had contributed approximately US$1.5bn to results, ocean had further improved its intrinsic performance by focusing on costs, agile capacity management, and the launch of new digital offerings.
Logistics & Services grew to US$ 7bn, compared to US$ 6.3bn in the previous year, and Ebitda improved to US$ 454m, supported by the acquisition of Performance Team as well as improved performance in intermodal, airfreight forwarding and warehousing and distribution.
“Our logistics business more than doubled earnings in 2020. We are today a profitable, growing logistics company with a broad offering of ocean and air transportation, port services and logistical capabilities, including warehousing, custom services and lead logistics,” added Skou.
Gateway terminals saw a decrease in revenue of 3.9% to US$ 3.2bn in 2020 because of lower volumes due to the impact of the pandemic. Ebitda increased by 8.3% to US$ 989m, reflecting an improved Ebitda margin to 31%, driven by higher revenue per move and cost reductions in several terminals, according to the statement.
Turning to guidance for 2021, Skou said that with the current outlook, there continued to be a high degree of uncertainty related to the impact of Covid-19 on economic growth and global demand patterns.
“A.P. Moller - Maersk expects another year of earnings growth and transformation progress. We expect the current, exceptional situation to continue into 2021, with Q1 to be stronger than Q4, followed by a normalisation thereafter, and announce a guidance for the full-year 2021 of an underlying Ebitda in the range of US$ 8.5-10.5bn, compared to US$ 8.3bn in 2020. This is equivalent to an underlying Ebit guidance of US$ 4.3-6.3bn and a free cash flow of above US$ 3.5bn.
Ocean is expected to grow in line with the global container demand at an expected 3-5%, with the highest growth seen in the first half-year.
