Maersk Line remains profitable

Despite record low container
freight rates Maersk Line
remained profitable during the
first quarter of 2016, according
to the Maersk Group’s interim
report.
Rates declined 26 % and
reached record low levels, with
lower rates across all trades,
especially Maersk Line’s key
European trades as well as
Latin American and North
American trades, according to
the report.
Volumes were, however, up
by 7% to 2.4 m FFE (forty foot
equivalent units).
Global container demand
is estimated to have grown by
around 1%, which means that
Maersk is gaining market share
according to its calculations.
The line’s capacity grew by
2.2% year-on-year to
3 m TEUs.
By the end of Q1, the Maersk
Line fleet consisted of 287
owned vessels
(1 848 000 TEU) and 318
chartered vessels (1 144k TEU)
with a total capacity of 2 992k
TEU, an increase of 2,2%
compared to Q1 2015 and an
increase of 1% compared to
Q4 2015.
Idle capacity at the end of
Q1 was 34 000 TEUs (four
vessels) versus 15 000 TEUs
(four vessels) at the end of Q1
2015 and on par with Q4 2015.
Maersk Line’s idle capacity
corresponds to around 2%
of total idle capacity in the
market.
“Managing capacity in line
with the low demand growth
in the industry remains a focus
area,” says the report.
“Global economic conditions
remain difficult to predict and
our businesses and ROIC are
significantly impacted by large
short-term volatility.
“Within these difficult
markets, we executed on our
plans to reduce cost and deliver
high operational performance.
“Maersk Line reiterates
the expectation of an
underlying result significantly
below last year (US$ 1.3bn)
as a consequence of the
significantly lower freight rates
going into 2016.
“Global demand for
seaborne container
transportation is still expected
to increase by 1-3%. Maersk
Line aims to grow at least with
the market to defend its market
leading position,” it says.