A.P. Moller-Maersk A/S, a key indicator of global trade trends, has warned that disruptions in global transport due to the conflict in the Red Sea will extend beyond this year. The Danish shipping giant now anticipates that these issues will persist throughout 2024.

Maersk’s forecast adjustment comes alongside its third increase in financial guidance within three months. The company reported on August 1 that higher freight rates have significantly boosted profits. The ongoing conflict has redirected shipping routes, forcing vessels to navigate around Africa instead of through the Suez Canal.

For the current year, Maersk has revised its earnings before interest, tax, depreciation, and amortization (EBITDA) estimate to between $9 billion and $11 billion, up from a previous range of $7 billion to $9 billion. Analysts had anticipated an average of $8.76 billion, according to Bloomberg.

The company had already upgraded its profit forecasts in May and June, citing the larger-than-expected impact of Red Sea congestion on global supply chains. Maersk now expects these disruptions to continue, at least until the end of 2024.

Container traffic through the Suez Canal has dropped by approximately 77% compared to a year ago due to safety concerns following attacks by Houthis. The additional shipping capacity required to navigate around Africa has driven up freight rates, compounding challenges in a market already facing a post-pandemic slowdown.

Maersk also updated its 2024 global container trade growth forecast to 4% to 6%, an increase from the earlier estimate of 2.5% to 4.5%. The company’s projected free cash flow for 2024 has risen to at least $2 billion, compared to a previous forecast of at least $1 billion.

Despite a 4.2% initial rise in Maersk’s share price in Copenhagen, the stock was trading 0.7% lower later in the day. Preliminary second-quarter revenue and profit figures, set to be fully reported on August 7, fell short of average analyst expectations