'Significant steps' have been taken by AP Moller-Maersk in its aim to become a global integrator of container logistics, the group’s 2018 annual report said.
It singled out how its process of providing customers with end-to-end supply chain solutions included integrating its transport and logistics businesses and Hamburg Süd, the successful separation of Maersk Oil and Maersk Tankers, and the announcement of Maersk Drilling’s separate listing in 2019. It added that “efforts are continually being made to find the best solution for Maersk Supply Service, although the timing is difficult to predict”.
The report pointed out that in the first year of its acquisition of Hamburg Süd, the integration progressed better than initially planned with synergies of US$420M in 2018.
Maersk Group’s ocean product – which includes its liner activities – saw revenue rise by 29% to US$28.4Bn with volume growth of 22% (2.5% excluding Hamburg Süd).
The average freight rate increased by 5.1% per FEU (excluding the Hamburg Süd rate impact). Unit cost at fixed bunker was 3.6% higher than in 2017, partly because of the effects of Hamburg Süd´s portfolio mix and negative foreign exchange rate developments. EBITDA was US$3Bn, up 7.14% year-on-year, but the EBITDA margin was 10.6%, down on the 12.6% achieved in 2017.
Maersk’s east-west volumes grew by 10% to reach 4.2M FEU, while volumes on the north-south trade rose by 21.2% to reach 6.5M FEU. Intra-regional volumes jumped by 47.1% to hit 2.7M FEU.
The report noted that north-south and intra-regional trades accounted for most of the increase in volumes, largely because of Hamburg Süd’s position in these markets. Maersk added “Due to a profitability focus including a capacity target of around 4M TEU in the second half of the year, the full-year volume growth of 2.5%, excluding Hamburg Süd, was lower than the estimated market growth of around 3.5-4%.
It said that Asia-Europe had a lower growth than the Asia-US and intra-Asia growth and intra-regional trades accounted for most of the increase in global growth.
The company is moving towards its aim as a global integrator. On 1 January 2019, Damco’s Supply Chain Services and Maersk Line’s Ocean Product became integrated and their respective value-added services were combined and sold as Maersk products and services.
Maersk acquired US customs brokerage business Vandegrift in February 2019 to boost its customs house brokerage, which it said was a “key component” in its strategy to become an integrated container logistics company.