AP Moller Maersk revises forecast down

AP Moller-Maersk recorded a 28% revenue increase for the past financial year, due mainly to significantly higher average oil prices and a higher share of oil production. Higher freight rates and container volumes also contributed to the growth. Revenue increased in the first nine months of 2008 to US$47.176 billion from US$36.970 billion in the same period in 2007. The net profit for the period was US$ 3.6 billion, compared to US$ 2.6 billion in 2007. The group has however revised its outlook down for the rest of the year with revenue expected in the order of US$ 62 billion against previously announced expectations of US$ 65 billion. Maersk Line and Safmarine transported 5.3 million FFE (forty-foot equivalent units) in the first nine months of 2008, which was an increase of 5% compared to the corresponding period of 2007 (5.1 million FFE). On the trades between Asia and Europe volumes were unchanged for the ninemonth period, but the group report noted that in the third quarter volumes fell by 3%. On the Far East and North America routes volumes increased by 1% in the first nine months while in the third quarter volumes increased by 16%, mainly due to increasing exports from North America. For the Africa trades, volumes were up by 15%, while volumes in the Latin America and Transatlantic trades increased by 4% and 19% respectively. Safmarine’s volumes went up by 20% compared to the same period of 2007. The average freight rates for Maersk Line and Safmarine increased by 11%, due to compensation for higher fuel costs. The deployment of new tonnage and the downturn in the global container shipping market however led to a considerable decline in base rates in the third quarter, especially in the trades from Asia to Europe. The net result for the line’s container activities was positive at US$ 92 million. However, excluding non-recurring costs of US$192 million related to the streamLINE initiatives, and gains of US$348 million on sale of ships etcetera, the net result was negative at US$ 64 million. This compared to a negative result of US$ 202 million in 2007, after gains on sale of ships etc. of US$ 145 million. Maersk Line and Safmarine took delivery of a total of eight container vessels in the third quarter. Group CEO Nils S. Andersen said he was satisfied with the result. “Our oil and gas activities were positively impacted by on average higher oil prices and higher share of oil production, and we had high activity in the offshore businesses. “The container business managed to deliver an improvement in the result despite severe pressure on rates, which is a good achievement. “Going forward our focus will continue to be on optimising operations and successful implementation of our investment programme for 2009, preparing the Group to compete in the tough market environment which must be expected.”