AP Moeller-Maersk: Increase in 1Q revenue thanks to freight rates, contracts signed at higher levels
By Dominic Chopping
AP Moeller-Maersk AS said on Wednesday that continued Covid-19 lockdowns in China had had a limited impact on its first quarter, but it could worsen the congestion environment in coming quarters as the situation evolves. while the Russian invasion of Ukraine added supply chain bottlenecks.
The Danish shipping giant released first-quarter profit figures last month and raised its full-year forecast, noting that supply chain disruptions had continued to drive up cargo rates for ships. containers.
In its Wednesday report, the company said net income rose from $2.72 billion to $6.78 billion, down from $7.08 billion in a FactSet poll.
Its shipping unit’s revenue rose 64%, thanks to higher freight rates caused by bottlenecks and congestion in global supply chains. Freight rates in the quarter were up 71% on the year, while shipping volumes fell 6.7%.
Maersk will withdraw completely from business in Russia and has begun a process of selling its 31% stake in Global Ports Investments, which operates six terminals in Russia and two in Finland.
It will also leave its two warehouses in Russia, a cold store in St. Petersburg and an inland terminal in Novorossiysk, while its unit in Svitzer will divest its Russian business which provides towing services in Sakhalin.
The financial impact of the Russia-Ukraine situation on first-quarter earnings before interest and taxes was $718 million, he added.
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