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Robert.Jervis_43227 Jan 12

A.P. Moller - Maersk accelerates Net Zero emission targets

maersk
Also announces Q4 figures and updated FY guidance
A.P. Moller - Maersk has announced new aspiring emissions targets expected to align the company with the Net Zero criteria of the Science Based Targets initiative (SBTi) pathway to limit global warming to 1.5°C. They include a societal commitment to act now and drive material impact in this decade, and a commitment to deliver net zero supply chains to customers by 2040. The targets go beyond previous efforts to reduce emissions related to the ocean fleet as they cover all direct and indirect emissions across the entire Maersk business.
 
“As a global provider of end-to-end logistics services across all transport modes, it is a strategic imperative for Maersk to extend our net zero ambition to the total footprint of the business. The science is clear; we must act now to deliver significant progress in this decade. These very ambitious targets mark our commitment to society and to the many customers who call for net zero supply chains,“ says Soren Skou, CEO of A.P. Moller - Maersk.
 
2030 targets for significant absolute emissions reductions

Tangible near-term targets for 2030 are set to ensure significant progress on curbing direct Maersk emissions already in this decade. 
 
These include a 50% reduction in emissions per transported container in the Maersk Ocean fleet and a 70% reduction in absolute emissions from fully controlled terminals. Depending on growth in the ocean business, this will lead to absolute emissions reductions between 35% and 50% from a 2020 baseline.
 
“Our updated targets and accelerated timelines reflect a very challenging, yet viable pathway to net zero which is driven by advances in technology and solutions. What is needed is a rapid scale-up which we will strive to achieve in close collaboration with customers and suppliers across the entire supply chain,” says Henriette Hallberg Thygesen, CEO of Fleet & Strategic Brands, A.P. Moller - Maersk.
 
As recommended by SBTi, over the decade Maersk will go above and beyond the 1.5°C-aligned targets and invest in building a portfolio of natural climate solutions that will result in around five million tons of CO2 savings per year by 2030.
 
To maximise progress towards net zero supply chains in 2040, ambitious 2030 targets for a range of green product offerings are introduced, adding to solutions including Maersk’s Emissions Dashboard and Maersk ECO Delivery. They aim to reinforce Maersk as an industry leading provider of green supply chain solutions and cover Ocean, Air, Contract Logistics (warehouses and depots) and Cold Chain businesses (see fact box below). These products will utilise green technologies and solutions to ensure that they provide real emission reductions within the supply chain.
 
Covering indirect emissions means the targets also address emissions from e.g., inland transport services and vessel building which are provided by third party suppliers. Tackling this challenge will require extensive data insights and close collaboration with local and regional suppliers of products and services across the Maersk business footprint.

The Maersk Decarbonisation Targets

2040

Net zero emissions across entire business and all scopes

•        Will be aligned with the SBTi net zero criteria

2030

Commitments to customers and society to act now and have impact in this decade

Emissions reduction aligned with SBTi 1.5°C pathway (Scope 1 and 2, baseline 2020)

•        Ocean: ~50% reduction in greenhouse gas emissions intensity
•        Terminals: ~70% absolute reduction of greenhouse gas emissions
•        Natural Climate Solutions used above and beyond 1.5°C target to build a portfolio that generates around five million tons of CO2 savings per year by 2030

Industry leading green customer offerings across the supply chain

•        Ocean: 25% of all cargo transported using green* fuels
•        Air: Minimum 30% of cargo transported using Sustainable Aviation Fuels (SAF)
•        Contract Logistics (warehouses and depots) and Cold Chain: Minimum 90% green* operations (Scope 1 and 2)
•        Inland transportation: Industry leading green offering – targets will be set during 2022

*Green means fuels or energy that have low or very low greenhouse gas emissions on a life cycle basis

Separately, Maersk has released its trading update for Q4 and full year 2021:

"A.P. Møller - Mærsk A/S (APMM) has for Q4 2021 recognised preliminary unaudited financials ahead of the previous expectations with revenue of USD 18.5bn, an underlying EBITDA of USD 8bn and an underlying EBIT of USD 6.8bn. Volumes in Ocean decreased by 4% and average freight rates improved by 80% in Q4 2021 compared to previous year.

The strong result in the quarter reflects the continuation of the exceptional market situation within Ocean caused by the global disruptions to the supply chains, which have led to further increase in container freight rates.

Consequently, given the strong performance in Q4 2021 the preliminary full-year figures for 2021 will exceed our previous guidance, as stated in the Interim Report dated 2 November 2021, now reporting an underlying EBITDA of USD 24bn (previous guidance of USD 22-23bn), an underlying EBIT of USD 19.8bn (previous guidance USD 18-19bn) and a free cash flow (FCF) of USD 16.4bn (previous guidance minimum USD 14.5bn).

APMM will give a revised outlook for Q1 2022 and full-year 2022 as part of the Annual Report 2021 that will be published on 9 February 2022."