VIDEO: Strong Year Start for Maersk

May 13, 2015

The Maersk Group delivered a profit of USD 1.6bn (USD 1.2bn) positively impacted by an after tax gain from the sale of shares in Danske Bank A/S of USD 223m.

The underlying profit increased by 18% to USD 1.3bn (USD 1.1bn) and the return on invested capital (ROIC) was 13.8% (10.0%).

“In a quarter impacted both by low oil prices and low economic growth, the underlying profit increased by 18% to USD 1.3bn, mainly driven by Maersk Line, Maersk Drilling and APM Shipping Services, whereas Maersk Oil and APM Terminals were impacted by lower oil prices and lower volumes in oil dependent markets,” says Group CEO Nils S. Andersen.

Maersk Line had a better than ever first quarter however, it did lose a certain market share during this period. This was attributed to efforts of getting the 2M to become fully operational as the process was said to be quite complicated.

Anderson said that the reason behind giving out a piece of the market share lied in the fact that Maersk Line did not follow its competitors in the speed that they were cutting market rates. The liner posted an underlying profit of USD 710m.

APM Terminals delivered a profit of USD 190m (USD 215m) and a ROIC of 12.9% (14.0%). The underlying profit was USD 175m (USD 216m). The result was negatively impacted by significant decreases in key oil dependant markets. Revenue increased by 4%, as a result of an increase in pass-through construction revenue.

Excluding this, the revenue decreased by 3% compared to last year, primarily due to the weakening of local currencies against the USD resulting in lower revenue in USD terms, as well as the low oil price negatively impacting revenues of some key terminals in oil dependant markets, the report shows.

Anderson said that all businesses affected by low oil prices launched cost initiatives to safeguard long term profits and competitiveness.

“Based on the performance in Q1, the group now expects an underlying result of around USD 4bn for 2015,” he added.

The group’s revenue decreased by USD 1.2bn or 10%, predominantly due to lower oil price, and operating expenses decreased by USD 744m, mainly due to lower bunker prices.

Tax decreased by USD 773m, primarily as a result of the lower oil price as well as a USD 170m deferred tax income as a consequence of the lowered tax rate on oil activities in the UK.

Maersk said that the impact from the sharply appreciated USD was limited on the overall group result due to the applied currency hedging policy.