Danish shipping group A.P. Moller-Maersk warned on Friday that trade tensions and an economic slowdown could put a brake on growth in freight movements.
Seen as an indicator of global trade patterns, Maersk posted first-quarter results in line with expectations as a decline in container volumes was balanced by higher freight rates.
The trade war between the world’s two biggest economies, the United States and China, resulted in “signs of decline” in trade volumes between Asia and North America in the first three months of the year.
“New tariffs can potentially reduce expected growth in global container volumes by up to 1 percentage point,” Maersk Chief Executive Soren Skou said in a statement.
Maersk, the world’s largest container shipping company, said in February it expected growth in the number of containers being moved around the world to fall to 1-3% this year from just under 4% last year.
“The recent escalation of the trade-war induced by an increase in tariff rates and threats of implementing additional tariffs could take global container trade growth to the lower end of the 1-3% interval (range),” Maersk said on Friday.
The company posted earnings before interest, tax, depreciation and amortization (EBITDA) at $1.24 billion for the quarter, compared with $1.25 billion forecast by analysts in a Reuters poll.
Revenue for the period stood at $9.54 billion, slightly below the $9.62 billion expected by analysts. Maersk said it still expects 2019 EBITDA of about $5 billion.
Shares were down 0.4% at opening in a positive market.
“Unit costs rose more than expected which is negative”, said Alm Brand analyst Michael Friis Jorgensen.
“When sailing around the world, Maersk is bound by the market price. But costs are actually something they can control themselves and this is what management is measured on,” he added.
The company also said it would launch a share buy-back program worth 10 billion Danish crowns ($1.50 billion).