AP Moller-Maersk has revised its full-year guidance for 2021 upwards, with its underlying Ebitda now expected in the range of $18bn to $19.5bn. Earlier guidance from the Danish liner giant had predicted Ebitda for 2021 would come in at $13bn to $15bn.

The company said it had made the revision after a strong second-quarter performance that was mainly driven by the “continuation of the exceptional market situation with strong rebound in demand causing bottlenecks in the supply chains and equipment shortage”. On Tuesday, AP Moller-Maersk revealed unaudited revenue of $14.2bn for the quarter, and an underlying Ebitda of $5.1bn. Volumes increased by 15% and average freight rates improved 59% as compared with the same period in 2020.

The company said it had revised its full-year guidance upwards “given the strong result in Q2 2021 and the exceptional market situation still expected to continue at least until the end of the full-year 2021. The outlook for the global market demand growth for the full-year 2021 has been revised up to 6% to 8% from previously 5% to 7%, primarily still driven by the export volumes out of China to the US. Earnings in the third quarter are expected to exceed the level for Q2 2021. Trading conditions for the quarters ahead are, however, still subject to a higher-than-normal volatility due to the temporary nature of current demand patterns, disruptions in the supply chains and equipment shortages.”

HSBC Global Research said AP Moller-Maersk’s revised guidance was not surprising given the profit guidance issued by several its peers in the past few weeks. Parash Jain, head of shipping and ports and Asia transport research at HSBC, described the guidance as conservative. “We still see room for one more earnings upgrade to 2021 earnings as visibility on the fourth quarter improves,” Jain said in a research note. “Evergreen, in its recently concluded AGM opined that the fourth quarter could be as strong as third quarter if port congestion persists.”

Because of the higher earnings expectations, AP Moller-Maersk said that despite increasing net working capital and higher instalments related to higher charter lease liabilities, its free cash flow for the full-year 2021 was now expected to be a minimum of $11.5bn, up from $7bn, while its cumulative capex [capital expenditure] guidance for 2021/2022 remained unchanged at around $7bn. The company will publish its second-quarter interim results on 6 August.