Investor Presentaiton
40
A.P. Moller-Maersk Annual Report 2020
Directors' Report
Performance 2020
Ocean
=1
Total operating costs decreased by 5.8% to USD
22.9bn (USD 24.3bn), impacted by lower volumes,
lower fuel costs and agile capacity manage-
ment, as well as favourable impact from devel-
opment in foreign exchange rates and lower con-
tainer-related costs. Network costs excluding bun-
ker costs decreased by 5.7%, mainly due to agile
capacity deployment through the COVID-19, lead-
ing to a high utilisation, and lower port costs due
to reduced calls. Adjusting for the positive impact
from the developments in foreign exchange rates,
the operating costs decreased by 5.2%. Based on
the lower cost base, container handling cost, bun-
ker cost and SG&A and other cost decreased their
share of total costs, while network costs, exclud-
ing bunker increased slightly.
Total unit cost decreased by 0.7% to 1,909 USD/
FFE (1,922 USD/FFE), driven by a decrease in fuel
cost caused by a 6.9% lower consumption and a
decreased average bunker price of 9.7%, equal
to 40 USD/tonne. The combined effect of lower
average prices and lower consumption resulted in
a total bunker cost decrease of 16% to USD 3.8bn
(USD 4.6bn). Out of the total decrease, USD 0.5bn
was due to the lower average bunker price, with
the remaining decrease due to lower consump-
tion partly, given a 0.8% improvement in bunker
Decarbonising ocean shipping
Moving the market with Maersk ECO Delivery
A core element of the strategy to decarbonise
shipping is to develop and commercialise prod-
ucts that reduce the carbon footprint of cus-
tomer supply chains. In 2019, A.P. Moller - Maersk
was the first to launch a carbon-neutral solution
for ocean transport, Maersk ECO Delivery, based
on sustainable biofuel from waste sources such
as used cooking oil. It provides direct carbon sav-
ings, not carbon offsets, by ensuring that for any
Maersk ECO Delivery container transport, enough
sustainable biofuel will be purchased and used in
the A.P. Moller-Maersk network to neutralise the
carbon emissions that would have occurred using
standard fuel. These CO₂ savings are allocated to
the customer and verified by the Roundtable on
Sustainable Biomaterials.
In 2020, customer uptake of Maersk ECO Delivery
exceeded expectations. So far, around ten major
customers have chosen to purchase this car-
bon-neutral emissions transport solution, and
this number is expected to increase. Conversa-
tions with customers on the possibility of con-
verting all their shipments to the Maersk ECO
delivery product are ongoing. While this is very
promising, it represents a small share of the
total amount of containers transported by
A.P. Moller-Maersk, and we need much more
customer demand to scale net-zero emissions
offerings and enable a transition to full decar-
bonisation.
Customer uptake of
Maersk ECO Delivery
exceeded expectations
in 2020View entire presentation