The Strategist

Maersk shares lose 17% after halting share buybacks amid disruptions in Red Sea



02/09/2024 - 07:09



Maersk's stock dropped 17% in Copenhagen following the release of its projections.



Llez
Llez
Following the release of statements and projections, shares of the Danish shipping corporation Maersk dropped 17% during trading in Copenhagen on February 8, according to CNBC. 

Maersk stated in its 2024 earnings projection that there is a lot of uncertainty because of Hussite attacks and an excess of commercial vessels that are causing impediments to ship passage in the Red Sea. 

The company projects its underlying EBITDA to be between $1 billion and $6 billion this year as opposed to $9.6 billion in 2023. Maersk has declared that their share buyback initiative is on hold.

Maersk, a Danish business that oversees one-sixth of global container trade, was forced to take a lengthy detour through southern Africa after Hussite attacks targeted its ships. According to the agency, the attacks have severely delayed traffic on the Red Sea, which typically makes up around 12% of all maritime trade. They have also thrown off the supply and demand equilibrium, driving up freight costs. According to Maersk CEO Vincent Clerc, there's still no clarity on whether the issue will be resolved in a matter of weeks, months, or a year.

source: cnbc.com




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