British transport large’s shares plunge on Trump’s tariff battle

Clarkson shares dived on Monday morning despite the firm reporting its profits have surpassed £100million for the third consecutive year.

Shares in the world’s largest shipping services provider plummeted 17.9 per cent to £36.20, as it warned of greater uncertainty from tariffs, trade tensions, sanctions and changing monetary policy.

President Donald Trump doubled the tariff on goods from China to 20 per cent last week, leading to China retaliating with tariffs on US farm products, such as chicken and soybeans.

Trump also imposed a 25 per cent tax on imports from Mexico and Canada before partially backtracking within days and announcing temporary exemptions for goods covered by the USMCA trade agreement.

Andi Case, chief executive of Clarkson, said 2025 had ‘started with more uncertainty than most,’ and caused freight rates and asset values to shrink.

Clarkson revealed its underlying pre-tax profits increased by 6 per cent to a record £115.3million in 2024, in line with previously upgraded guidance. 

Market reaction: Clarkson shares dived on Monday morning despite the firm reporting its profits have surpassed £100million for the third consecutive year

Following the result, the FTSE 250 company has raised its annual dividend by 7 per cent to 109 pence per share, the 22nd year of successive rises.

Its turnover rose 3.4 per cent to £661.4million as port congestion and the disruption to key trade routes from conflicts kept shipping rates elevated.

Attacks by Houthi militants on container vessels travelling through the Red Sea have significantly reduced traffic going through the Suez Canal.

Many shipping operators have subsequently diverted their ships around the Cape of Good Hope, adding 10 to 14 days to an average trip.

In addition, the Russia-Ukraine war has led to a considerable growth in tonne miles, as vessels take longer journeys to transport oil and gas from countries other than Russia to Europe.

Consequently, freight rates in the specialised products tanker market hit record highs in the first half of last year, while rates for box freight and time charter vessels in the container sector hit very high levels.

Case added: ‘The geo-political outlook remains uncertain as we enter 2025, with ongoing regional conflicts and trade tensions creating uncertainty for markets reflected by freight rates and asset values currently lower than 2024.

‘The resolution or continuation of these events during the year will provide potential headwinds and tailwinds to the group’s performance as we support our clients through this complexity.’

Case, who has run Clarkson since 2008, has received major blowback from the company’s shareholders over his generous compensation packages.

He received a £12million pay packet in 2023, nearly triple the £4.2million average earnings of a FTSE 100 boss and more than HSBC’s Noel Quinn, who made £10.6million and Reckitt Benckiser’s Kris Licht, who took home £8.9million.