Danish container shipping giant A.P. Moeller-Maersk intends to offer comprehensive logistics services. Among the means to achieve this will be acquisitions, for which the company wants to allocate $1bn.
Today, Maersk focuses mainly on sea transport. According to estimates, one in five containers worldwide is carried by the Danish company. That said, the giant intends to significantly expand its offering by transforming itself into a full-service logistics operator and putting more focus on its onshore operations.
Maersk announced its intention to develop its logistics offering back in 2019. In 2020, it spent half a billion dollars on US storage operator Performance Team.
Soren Skou, the company’s CEO, said that the company’s transformation process will now accelerate due to the unexpectedly good financial performance during the pandemic.
Onshore growth is to be driven by factory logistics, customs and warehousing services.
“The pandemic has no doubt underlined the value for our customers of doing business with a company that can take responsibility for everything all the way from the factory to the end destination,” Skou told Reuters in an interview.
The CEO added that Maersk sees great opportunities for growth in onshore logistics, as a look at the company’s 200 largest ocean freight customers shows that a ‘very, very small fraction of their onshore logistics is outsourced to the Danish company.
This is why Maersk is targeting like-for-like growth in its logistics business above 10% in the next five years.
“I don’t want to put a date to it, but I’m certain that our logistics business has potential to become just a big as ocean shipping measured in turnover,” Skou said.
The company aims to grow both organically and through acquisitions. It plans to spend $1bn on the latter over the next two years.
Container shipping accounts for around 73% of the company’s revenue and will remain its main segment. Maersk owns or operates about 710 container vessels with a total capacity of 4.1 million containers and operates 66 container ports around the world.
In 2020, the Danish company achieved an unexpectedly good financial performance. Its revenue increased by 2.2% to $39.7bn. EBITDA increased year-on-year by 44% to $8.2bn. Net profit, on the other hand, increased nearly 6-fold to $2.9bn.
Photo credit @ Maersk