Danish shipping giant A.P. Moller – Maersk saw a substantial decline in profitability in the second quarter of 2023 which stood at 12.4% significantly lower compared to the “extraordinarily” strong result at the same period last year.

Maersk on Friday reported a sharp fall in second-quarter profitability in difficult market conditions which led to lower volumes and lower rates, but still managed to beat market expectations and upgrade its full-year guidance.

Maersk´s quarter profit more than halved as markets normalize, whilst revenue sank from $21.7 billion in the second quarter of last year to $13.0 billion.

“The Q2 result contributed to a strong first half of the year, where we responded to sharp changes in market conditions prompted by destocking and subdued growth environment following the pandemic fuelled years,” CEO Vincent Clerc said in a statement.

Given the weak start of the year and the continued destocking, A.P. Moller – Maersk now sees the global container volume growth in the range of -4% to -1% compared to -2.5% to +0.5% previously.

While this implies lower second half volumes than originally expected, the shipping company raises its full year financial guidance reflecting the strong financial performance in the first half of the year.

Specifically, the Danish giant raises its financial outlook and now expects underlying Ebitda to come in between $9.5 billion and $11 billion, having previously estimated a range of between $8 billion and $11 billion. It also expects an underlying Ebit between $3.5 billion and $5.0 billon despite a weakened second half market outlook.

The world’s second-largest shipping company, often seen as a bellwether for global trade, posted a second-quarter Ebitda (profit before depreciation, amortisation and impairment losses) of $2.9 billion, well below the record $10.3 billion for the same quarter in 2022.

“Our decisive actions on cost containment together with our contract portfolio cushioned some of the effects of this market normalisation,” commented Vincent Clerc, chief executive.

“Cost focus will continue to play a central role in dealing with a subdued market outlook that we expect to continue until end year. While we step this agenda further up, we are unwavering in our transformation and continue to invest in and deliver truly integrated logistics solutions to our customers and amplify their supply chain resilience for the uncertain times ahead.”