EBIT margins of main container shipping companies 2014-2023

The average EBIT margin of main container shipping companies rose steeply between 2020 and 2023. While the average EBIT margin amounted to around 2.6 percent in the first quarter of 2020, its value climbed to 57.4 percent in the first quarter of 2022. The rest of 2022, however, saw a decline of the margin, dropping to 33.3 percent in the fourth quarter of 2022. The margin continued declining in the first half of 2023, decreasing to 8.9 percent in the second quarter of 2023 and reached -3 percent in the final quarter.

Record profits for container carriers in 2021 and 2022

While Maersk was making an EBIT of about 95 U.S. dollars on each TEU transported in 2020, this figure grew more than fivefold in 2021, reaching some 536 U.S. dollars per TEU transported. ZIM recorded an even higher increase in the average EBIT per TEU of selected container carriers, with almost 114 U.S. dollars per TEU in 2020 reaching over 1,256 U.S. dollars in 2021.
It is thus not surprising that profits of container ship operators increased considerably in 2021 compared to previous years. It was estimated that in 2021 alone, the global container shipping industry made an operating profit of 110 billion U.S. dollars. This is a staggering figure, considering that it is nearly three times more than the industry made over the previous 10 years combined.

The surge in freight rates driving carrier profits up

The main driver for the dramatic increase in profits was record-high freight rates, especially along the Suez Route between Asia and Europe. The surge in freight rates has been, in part, triggered by the arrival of the COVID-19 pandemic, and the disruptions of the pandemic have had a snowball effect on every aspect of the global supply chain. Due to a combination of factors, ports were being closed and becoming congested, leading to long ships queues, which further resulted in the low schedule reliability of container carriers. Moreover, the price of bunker fuel has been growing since mid-2020, putting more pressure on freight rates as well.