Danish shipping and logistics company Maersk on Thursday reported fourth-quarter profits below expectations and said it expects 2024 earnings well below last year's level amid an oversupply of container vessels although uncertainty remains around the impact of Red Sea disruptions.
Maersk suspended its share buyback program amid this uncertainty.
Maersk said it expected underlying earnings before interest, tax, depreciation, and amortization (EBITDA) of between $1 billion and $6 billion this year, compared with the $9.6 billion achieved last year, according to Reuters.
"High uncertainty remains around the duration and degree of the Red Sea disruption with the duration from one quarter to full year reflected in the guidance range," it said in a statement.
Maersk said EBITDA dropped to $839 million in the fourth quarter from $6.54 billion a year earlier, lagging analysts' expectations of $1.13 billion.
“The impact of this situation is causing new uncertainty for how this is going to play out from an earnings perspective throughout the year,” CEO Vincent Clerc told CNBC’s “Squawk Box Europe.”
“We have very little visibility as to whether this is a situation that will resolve in a matter of weeks or months, or whether this is something that is going to be with us for the full year,” he added.
In a statement, the company added that its board had decided to “immediately suspend the share buy-back program, with a re-initiation to be reviewed once market conditions in Ocean [division] have settled.”
The global supply chains have faced dangerous disruption since the end of 2023 after the giant shipping companies detoured their trips away from the Red Sea after a series of Houthis attacks.