“More favourable” market demand has seen Danish shipping giant AP Møller Mærsk (APMM) adjust its Q2 volume decline to be between -15% to -18% rather than -20% to -25%.
APMM said in a trading update: “With the current trading, the market demand in the second quarter of 2020 is developing more favourable than originally expected with volumes downfall for APMM now anticipated to be in the range of -15% to -18% for Q2 2020, compared to the initial guidance of -20% to -25%.”
It added: “Based on the market development, combined with cost measures across the organisation and significant blanked sailings in Ocean, APMM expects an EBITDA before restructuring and integration costs for Q2 2020 slightly above the level for Q1 2020 ($1.5bn).”
Søren Skou, CEO of APMM, said: ““Despite an expected 15-18 pct. drop in demand due to Covid-19 during the second quarter, I am pleased that we expect to deliver operating earnings slightly above our operating earnings in the first quarter. This also means we expect operating earnings to be higher than they were in the same quarter last year.
“We have been able to navigate well in a very difficult second quarter, adjusting capacity to demand to maintain high utilization of our network and managing our cost across the company.
“This quarter follows a first quarter where we also delivered year-on-year earnings growth despite 5 pct. lower demand and sharply increasing fuel cost as a result of the switch to low Sulphur fuel on 1 January.
“While uncertainty persist because of the pandemic and low visibility on the recovery path, we benefit from a more resilient Ocean-business.”
Given the uncertainty on demand recovery in the second half of 2020 as economies are still impacted by COVID-19, the full-year guidance on earnings remains suspended.
APMM will publish its Q2 interim result on 19 August 2020.
