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© Reuters.

By Geoffrey Smith – The world’s largest shipping company highlighted the trend of restocking that has been one of the salient features of the latter stage of the pandemic. Danish shipping giant Moeller-Maersk (OTC :), which accounts for more than one in four of the containers shipped globally, said its windfall gains from buoyant global trade are likely to peak in the first quarter and they “normalize” thereafter. Maersk (CSE 🙂 shares responded with their worst intraday decline in weeks, its A shares losing 5.7% at 6am ET (1100 GMT), having rebounded weakly from a three-month low. The news is important because Maersk’s performance has represented the change in global consumer spending patterns over the past year, in which people locked in their homes have diverted their disposable items from services that are temporarily unavailable to consumers. assets, many of which have been earmarked for their home improvement or adaptation. The global shipping industry has been maximized by that trend, and China’s foreign trade asymmetry, in particular, is only making matters worse, forcing many ships to spend half their time empty on the legs back to China. . That has allowed carriers like Maersk the opportunity to push prices up dramatically: The company estimates it contributed $ 1.5 billion to earnings before interest and taxes in 2020. The “normalization” that Maersk expects will not be abrupt, either. Profits are not going to fall off a cliff. The first quarter of this year is still expected to be better than 4Q 2020. The underlying EBITDA is forecast to increase to between $ 8.5 billion and $ 10.5 billion this year, from 8.3 billion last year. Its key Ocean division is still ready to grow in line with global demand of between 3% and 5%, although here too, growth will slow down in the second half. The midpoint of the EBITDA range is almost exactly where Maersk’s net debt was at the end of the year, so there will be minimal pressure on its ability to continue buying stocks. However, the market has already decided that the Maersk cyclical high is past. After Wednesday’s losses, the stock is down 20% from its peak three weeks ago, after posting its biggest gains since 2005 last year. Vaccines and the lifting of blockades across the Northern Hemisphere are likely to ensure this trend continues: barring further disasters, 2021 will be the year when spending on trips, dinners and commutes revives at the expense of bicycles. fitness, couches and PC upgrades. While the easing is likely to be softened for Maersk by fiscal stimulus that will float all ships, underperformance is likely to be a constant from now on.

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