A prolonged Red Sea crisis has been highlighted as one of the reasons for AP Moller-Maersk’s earnings before interest, taxes, depreciation and amortisation (ebitda) plunging 92% year-on-year (y-o-y) for the first quarter (Q1) of 2024.
Whereas gross revenue stood at $3.2 billion for Q1 in 2023, the line’s ebitda decreased to $1.5bn.
Excluding depreciation and amortisation, ebit fell to $117 million from $2.3bn for the same y-o-y period.
A statement by the holding company of the world’s second-biggest container line by capacity said: “Results were driven by a good performance in terminals and the combination of higher demand and a prolonged Red Sea crisis.”
Maersk said that since these conditions were likely to continue well into the second half of the year, it expected to lift the lower end of its guidance range to level out, up from $-2.0.
Maersk CEO Vincent Clerc said that despite what was happening around vessel traffic disruption through the Suez Canal because of disruption in the Red Sea, the line remained optimistic.
“We had a positive start to the year, with a first-quarter developing precisely as we expected.
“Demand is trending towards the higher end of our market growth.”
Recovery from maritime upheaval is expected to result in “an improved outlook for the coming quarters, as we now expect these conditions to stay with us for most of the year.
“However, we still anticipate the high number of new vessels being delivered during this and next year to eventually offset these factors and put the ocean markets under renewed pressure.
“We therefore relentlessly continue to pursue our cost agenda with the aim of rolling back the disruption-linked cost in ocean (freight) and restoring margins in logistics and services.”
