Maersk: China's cargo volume will hardly recover until the second quarter due to Corona virus

Warning that the Chinese manufacturing industry and the volume of container shipping goods it produces will not be able to recover until the end of the second quarter due to the impact of Corona virus (COVID-19), Maersk has improved profits. 2019 regardless of the fourth quarter loss.

Soren Skou - CEO of A.P. Moller - Maersk, said Thursday in a media response: “If no issues are reported in the coming weeks then we will probably see a V-shaped recovery with very weak levels. in February and many difficulties in March. The end of the second quarter may be a recovery period ”.

Due to reduced demand, Maersk said it canceled more than 50 shipments, which exceeded the usual number of cuts during the Chinese New Year. About 30% of its shipments come from China, Taiwan and Hong Kong.

A loss of US $ 61 million in the fourth quarter pulled A.P.'s net profit. Moller-Maersk to $ 509 million for the whole year. The Group reported a loss of $ 755 million in 2018. Sales in 2019 were slightly lower than in 2018, with an annual revenue of $ 38.89 billion, down 0.9% from the previous year. Revenue from shipping business, the group's largest segment, remained unchanged at $ 28.4 billion, as well as container throughput of 13.29 million TEUs for the year.

Despite that, 2019 earnings figures remain low, with average freight rates increasing by $ 4 per TEU, fuel prices down slightly from 2018. Earnings before interest, taxes, depreciation and gradually deducted (EBITDA) for the year increased 14.2% compared to 2018 at US $ 5.7 billion, and in the shipping segment, EBITDA increased by 15% to US $ 4.35 billion.

Although the situation of the container shipping industry is generally very difficult throughout 2019, this is the last quarter that the market will decline. Maersk cargo volume on the East-West routes over the past three months has decreased 5.7% from the previous year to 984,000 TEUs and decreased 2.5% on larger North-South routes with a reduction of 1.57 million TEUs. . Falling production led to a 3.4% drop in revenue in the fourth quarter to $ 7 billion and a net loss of $ 61 million.

Maersk argued that the reason for the decline in growth was the widespread economic weakness and the negative impact of escalating trade restrictions.

Phaata (Source: JOC)

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