DENMARK's increasingly diversified Moller-Maersk Group, which owns the world's largest container shipping company, has posted a 78 per cent drop in third quarter in profit year on year to US$371 million while enjoying a nine per cent increase in revenue to $15.3 billion.
The group moved 16 per cent more containers in the third quarter to 2.1 million FEU, but declining freight rates, particularly on the Asia-Europe route, led to a loss of $297 million. Thus, Maersk expects its container business to post a negative result for the full year.
"Unsatisfactory market conditions are a challenge, however Maersk aims to achieve an EBIT-margin five per cent point above peers," said the company statement accompanying the results.
Said CEO Nils Andersen: "We are heading for a fairly satisfactory result for 2011 when you consider the very low rates in container shipping. The group's other core activities performed very well. With 'Daily Maersk', Maersk Line has improved its service to customers, and our recent large drilling contracts, our new terminal concessions and the significant Avaldsnes find in Norway demonstrate that our core businesses are progressing and expanding."
While most of its business segments delivered good returns, tankers faced difficult markets "due to excess supply of tonnage and a fragmented competitive landscape".
The company said that it is in good shape financially and is "prepared and determined to execute on its long term growth aspirations and seize market opportunities within its core businesses despite current turmoil in the financial markets".
The group's oil and gas activities continue to invest in building and developing its resource base, and had another strong earnings quarter with a profit of $341 million.
Maersk Tankers posted a loss of $37 million, excluding impairment loss of $107 million. Again, overcapacity in the crude and product market is expected to continue whereas the gas market is positively affected by limited new supply, said the company statement.
Maersk Drilling had another strong quarter and Maersk FPSOs and Maersk LNG had full vessel utilisation during the third quarter. Maersk Supply Service benefited from improved spot rates in the North Sea and a high activity level in Brazil and delivered a profit.
