A.P. Moller – Maersk reports solid progress in the second quarter of 2019. Earnings recovery due to Its profits in its Ocean business, the effect of a continuous recovery consolidated.
Earnings before interest, taxes, depreciation and amortization (EBITDA) increased by 17% to USD 1.4 billion of the USD 1.2 billion reported in the same period of the previous year. The change was attributed to an increase of USD 212 million in its Ocean business, driven by higher rates and higher cargo volumes, as well as strong operational efficiency.
Operating profit (EBIT) increased from USD 65 million to USD 416 million, reflecting an improvement in the margin to 4.3%, while the underlying benefit was positive at USD 134 million compared to USD 15 million a year earlier.
Revenues grew slightly at USD 59 million and were on par with the second quarter of last year at USD 9.6 billion with an increase of USD 198 million in the Ocean Business and USD 110 million in Terminals and Tugs. This was partly offset by the decrease in manufacturing and other revenues, mainly due to the exit of the dry container business and 30% less revenue in the refrigerated segment, as well as the divestment of bulk activities originally acquired from Hamburg. South.
“Q2 was a quarter of solid progress. EBITDA increased 17% and cash flow improved 86% year-over-year, driven by continuous recovery in Ocean, ”Søren Skou, CEO of A.P. Moller – Maersk said.
“The transformation progressed further with an improved cash return on invested capital of 6.9% and synergies of USD 1 billion made earlier than expected. The growth of revenues and gross profits in Logistics and Services must still improve as we continue to develop capabilities within logistics and services, ”said Skou.
A. P. Moller – Maersk reiterated his orientation, still expecting earnings before interest, taxes, depreciation and amortization (EBITDA) of around USD 5 billion.
The organic volume growth in Ocean is still expected to be in line with the estimated average market growth of 1-3% for 2019.
“We reaffirm our orientation for 2019, while the macro environment remains subject to considerable uncertainties.”