A.P. Moeller-Maersk AS said Wednesday that it will accelerate its share buyback program and launch a new program of up to 31 billion Danish kroner ($5.01 billion) as rising demand and freight rates have propelled the company's earnings and cash flow higher.
The Danish shipping giant last month upgraded guidance and provided preliminary first-quarter earnings after saying a surge in demand had led to bottlenecks and a shortage of containers, sending freight rates higher.
The company posted a quarterly net profit attributable of $2.7 billion, up from $197 million in the same period the previous year, and compared with $2.38 billion seen in a FactSet analyst forecast.
Revenue rose 30% to $12.44 billion, in line with guidance provided last week.
Maersk, which is considered a barometer of global trade, confirmed that shipping volumes rose 5.7% in the quarter and that average freight rates were 36% higher, just above the guided 35%.
The company previously announced a share buyback of up to DKK10 billion, with the first phase of DKK3.3 billion concluded last month. The remaining DKK6.7 billion will be exercised between mid-May and the end of September 2021, and a new program of up to DKK31 billion will be executed over two years when the current one is finalized.
Maersk backed guidance it gave last week.
Write to Dominic Chopping at [email protected]