Record Profit for Maersk

Danish conglomerate A.P. Moller Maersk Group delivered a strong financial performance in 2014, recording a profit of USD 5.2 bn.

Maersk said that the profit was positively impacted by the USD 2.8 bn gain from the sale of majority share of Danks Supermarked Group and other divestment gains worth USD 600 million.

“In line with expectations, the underlying profit increased by 33% to USD 4.5 bn compared to USD 3.4 bn from 2013 and the return on invested capital was 11% compared to 8.2% from 2013,” the group went on to say in its 2014 full year results.

“We are very satisfied with the result for 2014 where we achieved the highest ever profit of USD 5.2 bn. Despite challenging market conditions we saw good progress in underlying performance across the Group,” comments the Group CEO, Nils Smedegaard Andersen.

Maersk Line maintained its lead on the rest of the industry, according to Andersen, delivering a higher than expected profit of USD 2.3 bn due to stronger than expected volumes as well as lower unit costs and bunker prices.

The underlying profit was also higher than expected reaching USD 2.2 bn, the results show.

APM Terminals delivered significant improvements, according to the results, earning a profit of USD 900 million, compared to USD 700 million from the previous year.

The profit was attributed to volume and margin growth along with divestment gains mainly from the port of Virginia. However, the result was negatively affected by impairments relating to activities in joint ventures, Maersk explained.

“Maersk Drilling executed on fleet renewal programme according to plan, while Maersk Oil increased entitlement production in line with expectations. APM Shipping Services’ underlying result came in lower than expected, primarily due to the result in Damco,” Andersen added.

Speaking about the outlook, Andersen said that the group is well positioned to take advantage of opportunities materialising in a volatile macroeconomic environment.

In line with that, the group has decided to divest its Danske Bank shares.

With regard to forecast for 2015, Maersk expects an underlying result slightly below USD 4.5 bn excluding Danske Bank.

Gross cash flow expenditure is expected to be around USD 9 bn in 2015. Maersk Line, Maersk Drilling and APM Shipping Services expect higher underlying results in 2015 from those recorded in the preceding year.

Maersk Line is targeting competitiveness boost through unit cost reductions and implementation of the new 2M Alliance, along with expected market growth of 3-5 %.

APM Terminals expects its operation to be in line with results from 2014 (USD 849 mln).

On the other hand, the group predicts that Maersk Oil’s results for 2015 would be slashed amid lower oil prices.