Maersk plans lay off 2,000 in business shake-up, boosts outlook amid growing freight demand

Maersk plans lay off 2,000 in business shake-up, boosts outlook amid growing freight demand
The Danish giant is set to merge its sea and in-land logistics sectors. (Reuters)
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Updated 13 October 2020

Maersk plans lay off 2,000 in business shake-up, boosts outlook amid growing freight demand

Maersk plans lay off 2,000 in business shake-up, boosts outlook amid growing freight demand
  • Maersk currently has around 80,000 employees

COPENHAGEN: The world’s biggest container shipping line, Maersk, said demand was recovering faster than expected and lifted its earnings outlook, while also announcing plans to cut 2,000 jobs as it streamlines to cut costs.

Maersk, which handles about one in five containers shipped worldwide, said that though cargo volumes were still down on last year they had picked up more than forecast after falling sharply at the height of the coronavirus pandemic a few months ago.

“A.P. Moller — Maersk is on track to deliver a strong Q3 with solid earnings growth across all our businesses, in particular in Ocean and Logistics & Services,” CEO Soren Skou said in a statement. “Volumes have rebounded faster than expected, our costs have remained well under control, freight rates have increased due to strong demand,” Skou said.

Volumes in Maersk’s Ocean-division declined by around 3 percent in the third quarter compared to the same period last year, above an expected mid-single digit contraction, the company said.

The Danish company said it would cut 2,000 positions as a result of a major reorganization announced last month, where it seeks to integrate its seaborne container and in-land logistics businesses.

Maersk currently has around 80,000 employees. Shares in Maersk were down by around 1 percent on Tuesday morning.

The company expects restructuring costs of around $100 million in the third quarter related to the redundancies.

Maersk said it now expects full-year earnings before interest, taxes, depreciation and amortization (EBITDA) in the range of $7.5 billion to $8.0 billion before restructuring and integration costs, up from an earlier range of $6.0 billion to $7.0 billion.

Preliminary results for the third quarter showed revenue at $9.9 billion, while EBITDA before restructuring and integration costs came in at $2.4 billion, Maersk said.


PIF’s real estate developer breaks ground on flagship Riyadh project

Updated 30 min 20 sec ago

PIF’s real estate developer breaks ground on flagship Riyadh project

PIF’s real estate developer breaks ground on flagship Riyadh project
  • Subsidiary hails strategic launch as part of Kingdom’s 10-year drive to increase home ownership rate to 70%

RIYADH: ROSHN, the real estate subsidiary of sovereign wealth fund the Public Investment Fund (PIF) has broken ground on its flagship residential project in the Saudi capital.

The developer’s first community project in the Saudi capital will cover an area of more than 20 million square meters. The project will consist of 30,000 housing units when complete, with 4,000 in the first phase.

The first district is strategically located in the north of the city, near Princess Noura University and south of King Khalid International Airport. The site connects residents to the main roads and transportation network, in addition to parks, pedestrian paths, bicycle paths, restaurants, cafes, schools and mosques.

David Grover, group CEO at ROSHN, said: “The announcement of the Riyadh community represents the initial step in the realization of our vision to become the most trusted community developer in Saudi Arabia. We are deeply committed to contributing to Vision 2030’s plans to increase the rate of home ownership in the country to 70 percent, while delivering high-quality homes and excellent amenities to the Saudi people.”

Launched in August this year, ROSHN has put in place a 10-year plan to develop neighborhoods across the Kingdom in eight phases.

“We are proud to launch ROSHN, a national company specialized in developing modern residential compounds, as part of PIF strategy to develop (Saudi Arabia’s) real estate market,” PIF said in a tweet.

Last month, ROSHN announced the signing of SR1.6 billion ($426 million) in new construction contracts.

According to a press statement last week, sales of off-plan homes at the new site will start in the first half of 2021.