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High prices give Maersk largest-ever profit for a Danish company

Danish shipping giant Maersk on Wednesday posted record-beating profits in 2021, as container freight prices continued to soar due to the global supply chain crunch caused by the Covid pandemic.

Maersk containers at Aarhus Harbour
Maersk containers at Aarhus Harbour. The shipping giant recorded the highest ever annual profits by a Danish company in results released on February 9th 2022. File photo: Henning Bagger/Ritzau Scanpix

For the full year, Maersk registered a net profit of $18 billion (15.8 billion euros), the highest profit ever recorded by a Danish company.

For 2022, Maersk predicted a “solid first half” would be followed by a “normalisation” of the sector early in the second part of the year.

Demand for shipping plunged at the start of the pandemic, but has rebounded strongly since mid-to-late 2020.

As a result, sales for 2021 jumped by 55 percent to $61.8 billion, with the Ocean container shipping segment soaring by 65 percent.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) almost tripled to $24 billion, thanks to lower costs and optimisation of its logistics chain, Maersk said.

Its main competitors, Italy’s MSC and France’s CMA CGM, have also posted record profits for 2021.

Shipping customers have had their patience put to the test and had to dig deep into their pockets as the supply chain disruptions plague the container shipping segment.

In the fourth quarter, the sector experienced “exceptional conditions with significant and persisting bottlenecks, while the volumes were down”, Maersk said in its annual report.

Freight costs rose especially on Asian routes to Europe and North America, the Danish group said, with the unit cost at fixed bunker increasing by 13 percent.

Maersk’s record profits are expected to continue this year, with EBITDA forecast to come in at the same level as in 2021, around $24 billion, despite the normalisation expected in the second half.

The company, which aims to be carbon neutral by 2050 by turning to green energy for its fleet, said its emissions declined by 42 percent in 2021. 

READ ALSO: Maersk profits up as global supply chain disrupted

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SAS

Scandinavian airline SAS passenger numbers ‘highest since pandemic’

The number of passengers who flew with Scandinavian airline SAS in April was far higher than during the same month in 2021.

Scandinavian airline SAS passenger numbers 'highest since pandemic'

Over 1.5 million flew with SAS last month, around four times as many as in April 2020 when Covid-19 restrictions were still in broad effect.

SAS still has some way to go to return to the number of passengers it registered before spring 2020, the “pre-pandemic” period for the hard-hit industry.

The airline was affected by a pilots’ strike in April 2019 which affected results for that month, but 2.5 million people flew with SAS in April 2018, demonstrating how the airline is still lagging behind earlier years despite the apparent recovery.

“We continue the ramp-up and see the highest number of passengers since March 2020,” president and CEO of SAS Anko van der Werff said in a press statement.

“Looking forward, sales and booking trends are positive for the summer period ahead,” he added.

SAS’ capacity in April was around two-thirds of its capacity in 2018.

“SAS is a bit more restrained in increasing its capacity than many of its competitors,” aviation sector analyst Jacob Pedersen of Sydbank told news wire Ritzau.

The company faces a challenge to make as much profit from its services as it did before the Covid-19 pandemic, according to Pedersen.

“The snapshot image of the trend in April is certainly encouraging but a closer analysis gives less cause for encouragement,” he said.

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