Shipping giant Moller-Maersk sees profits halved

Maersk Oil said it made a profit of $32 million for the third quarter of 2015, against a $222 million profit reported one year ago.

Group CEO Nils S. Andersen said the decline of almost 50 percent in underlying profit compared to past year was primarily due to container freight rates deteriorating to a historically low level, especially in the later part of Q3, and profits in Maersk Oil being impacted by the lower oil price.

The company blamed weaker container freight rates and lower oil prices for the 48 percent slide in its third-quarter profits, which came in at $778 million (714.9 million euros).

Revenue dropped 17% to 10.11 billion dollars (£6.7 billion), from 12.2 billion dollars (£8.1 billion) a year earlier.

On Oct 23, the group cut its full-year net profit outlook to US$3.4 billion from a previous forecast of US$4.0 billion.

Shipping and oil conglomerate AP Moller-Maersk said yesterday third-quarter profit nearly halved and global demand for container transportation this year would grow at a slower pace than previously expected.

Maersk Line has struggled with oversupply and decreased imports into Europe, where freight rates declined 19.3% in the quarter to new historical lows.

“The result was negatively impacted mainly by the lower oil price but positively impacted by increased production, cost savings and lower exploration costs”, the company said in a statement. “We advise caution when it comes to buying the share, even if the pricing is tempting”.