By Geoffrey Smith
Investing.com -- AP Moeller Maersk (CSE:MAERSKb) raised its 2022 guidance for a second time on Tuesday, after the long-expected cooling in global freight rates again failed to materialize in the second quarter.
"Congestion in global supply chains leading to higher freight rates has continued longer than initially anticipated," the Danish-based shipping giant said as it released core second-quarter numbers a day ahead of schedule.
Revenue in the three months through June totaled $21.7 billion, while underlying earnings before interest, taxes, depreciation, and amortization were $10.3 billion. Underlying earnings were still $8.9 billion even after amortization and depreciation, which are typically big expenses for the capital-heavy business.
"The strong result is driven by the continuation of the exceptional market situation within Ocean," Maersk said, referring to its main shipping division.
Maersk said it now expects underlying EBITDA to be $37 billion this year, up from a previous estimate of $30 billion, while expectations for underlying EBIT have also been revised up by nearly one-third to $24 billion. The company's estimate for free cash flow, meanwhile, rose from $19 billion to $24 billion.
Maersk stock rose 1.6% in response to the news by 03:30 AM ET (0730 GMT), on a day when most European stock markets were down amid concerns over China's possible reaction to the visit to Taiwan by U.S. House of Representatives Speaker Nancy Pelosi.