A.P. Moller-Maersk A/S, the world’s largest container line, on Monday raised its guidance for profit this year after freight rates soared as lockdowns amid the COVID-19 pandemic led to a surge in spending on shipped goods.
The Copenhagen-based company added almost US$5 billion to the midpoint of its operating profit forecast, it said in a statement.
Full-year earnings before interest, taxes, depreciation and amortization (EBITDA) will be US$18 billion to US$19.5 billion, up from a previous forecast of US$13 billion to US$15 billion, the statement said.
Photo: Reuters
Underlying EBIT will be in a range of US$14 billion to US$15.5 billion, compared with US$9 billion to US$11 billion previously, it said.
“The strong quarterly performance is mainly driven by the continuation of the exceptional market situation with a strong rebound in demand causing bottlenecks in the supply chains and equipment shortage,” Maersk said.
Over the past year, freight rates have repeatedly reached records amid intense demand and limited supply.
On the demand side, consumers who were unable to channel savings into restaurant visits and trips abroad instead spent their money on imports.
On the supply side, already tight capacity was hit by bottlenecks that squeezed traffic in key routes.
Maersk shares rose 1.5 percent after trading started in Copenhagen yesterday, bringing its gains this year to more than 30 percent.
“Freight rates have continued their ascent, so a profit upgrade is not a surprise, but the new forecast range is higher than expected,” Sydbank A/S analyst Mikkel Emil Jensen said in a note.
Maersk, which in May said that it would buy back US$5 billion in stock, is scheduled to release its full second-quarter report on Friday.
The company on Monday provided some unaudited second-quarter figures, with revenue of US$14.2 billion, underlying EBITDA of US$5.1 billion and underlying EBIT of US$4.1 billion.
Earnings in the third quarter are expected to “exceed the level for the second quarter, the company said.
This year’s global container demand is expected to grow 6 to 8 percent, up from 5 to 7 percent it expected previously, primarily driven by export volumes out of China to the US, it said.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six