Shipper Moller-Maersk posts ‘satisfactory’ Q2 result

The division retains the forecast financial results and despite the 14% drop the freight rates.

On Thursday shares in A.P. Moeller-Maersk jumped after the worlds biggest freight company released profits above Wall Street’s estimates despite falling freight rates.

Maersk Line, closely watched by investors and trade experts because of its role in transporting 15 per cent of seaborne freight, posted net profit of $507 million, ahead of analysts’ forecasts but still down 7 per cent year on year.

The Copenhagen-based group said Thursday it expects an underlying result for 2015 of around $4.0 billion, and reiterated that its strategy was “to become a premium conglomerate”.

Targets for its port terminals and drilling rigs businesses to earn $1 billion by 2018 and for its oil unit to produce 400,000 barrels a day by 2020 have been abandoned because of low crude prices. Roughly 90 percent of the world’s goods are carried by sea with over 70 percent in containers.

The balance sheet “remains strong”, which will enable the company to buy back own shares for about $1 billion, he said.

“During the quarter, impacted by lower average cost per container and lower oil prices, Maersk Group achieved satisfactory results”, commented the CEO of AP Moeller-Maersk, Nils Andersen.

He argued that Maersk Line was obliged to “take back the market share” it had conceded in the first quarter when he said the carrier had been “very late joining the dynamic rate environment” – shorthand for a rate war – between Asia and Europe.

For the quarter ended June 30, the Danish company made a net profit of $1.07 billion, compared with $2.25 billion a year earlier, on 12% lower revenue at $10.53 billion.

Denmark’s AP Moller-Maersk, which operates the world’s largest container shipping line, has revealed another huge share buy-back scheme a year after it launched its current programme.