Copenhagen, Denmark — Shipping conglomerate A.P. Moller-Maersk reported profits in the second quarter of 2019 of USD$134 million, up from $15 million the year previously.
The company reported a 17% increase in earnings before interest, tax, depreciation and amortization (EBITDA) to USD 1.4 bn in Q2 compared to the same quarter last year. Revenue grew slightly to USD$9.6 billion which is on par with last year.
“Q2 was a quarter of solid progress. EBITDA was up 17% and cash flow improved 86% year on year, driven by continued recovery in Ocean,” stated Søren Skou, CEO of A.P. Moller – Maersk.
On the back of the increases in volume and freight rates, Ocean EBITDA in Q2 increased 25% to USD 1.1bn. The Ocean business continued to recover with enhanced unit cost, utilization and reliability and revenue grew 2.9% to USD 7.2bn compared to Q2 2018.
Revenue in Terminals & Towage grew 13% to USD 957m compared to Q2 last year. In gateway terminals, volume in Q2 grew by 8.5% compared to last year, leading to higher utilization. EBITDA increased by 11%, partly offset by one-off items.
In Logistics & Services EBITDA grew to USD 61m in Q2 compared to USD 52m in the same quarter last year. Revenue was at USD 1.5bn, positively impacted by increased revenue in supply chain management, but offset by declining revenue from sea and air freight forwarding.
During the first half of 2019, A. P. Moller – Maersk formed one sales organization. Its focus is now on giving customers an integrated experience and offering them even more products, thus improving the financial results across the business and accelerating the transformation.
“The transformation progressed further with an improved cash return on invested capital of 6.9% and synergies of USD 1bn realized earlier than expected. Growth in revenue and gross profit in Logistics & Services still need to improve as we continue to build capabilities within logistics and services,” Skou elaborates.
The latest example of a digital innovation to improve customer experience is Maersk Spot, which simplifies the buying process and offers increased visibility and reliability by enabling customers to search and get competitive rates online, while ensuring cargo gets on board the selected vessel. TradeLens, the blockchain platform developed together with IBM, also progressed with several new commitments from carriers and port authorities during the quarter.