The outlook on container shipping profits is bright with 2022 results expected to top 2021 results.
The expectations also see that the results for the second half of 2021 to be more profitable than the fourth quarter of 2020, even though the peak is believed to arrive in 2022.
Deutsche Bank predicted that container shipping has entered a super cycle, while Stifel analyst Ben Nolan expected that container craziness would not abate before 2022 or even 2023.
“We are moving to the view that earnings will peak in 2022, not this year. We feel that there is a material positive surprise to 2022 and 2023 forecasts for carriers that are yet to be factored into consensus forecasts,” commented Andy Chu of Deutsche Bank.
He added that at the moment, the supply chain issues and port congestion issues are deteriorating and not improving.
“Given the high amount of port congestion and lingering nature of COVID-19, we think that these issues will not be quickly resolved,” Chu added.
Shipping companies are raising their full-year guidance for earnings for this year.
On Thursday, Maersk adjusted up its 2021 earnings before interest, taxes, depreciation, and amortization (EBITDA) projection to between USD22-23 billion, up from prediction released in the second quarter of USD13-15 billion.
For the third quarter, Maersk is predicting a USD7 billion EBITDA and USD6.9 billion in the fourth.
In the past two months, Taiwan’s Evergreen posted record highs in operating revenues, TWD45.88 billion (USD1.65 billion) in July and TWD50.02 billion (USD1.8 billion).
For Germany’s Hapag-Lloyd, Deutsche Bank predicted it to earn USD11.54 billion in 2021 and USD11.88 billion in 2022.
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Published on September 21, 2021 5:58 PM (GMT+8)Last Updated on September 21, 2021 5:58 PM (GMT+8)
