Maersk steaming toward a $4.5bn profit, boosted by container line’s ‘solid’ Q3
It’s still full steam ahead for the Maersk group. The Danish transport and energy conglomerate posted a $1.5bn net profit in the third quarter, with flagship Maersk Line delivering a solid $685m and strong performances from APM Terminals and its oil division.
Chief executive Nils Andersen, said the group was “very satisfied” with a result that represented a return on sales of 12.7%, and that it was “well positioned to take advantage of opportunities materialising”.
Mr Andersen said there was “some caution in relation to the market for the coming quarters” and conservatively maintained the full-year profit outlook for the group at $4.5bn.
Maersk Line transported 4.8m teu in the quarter, an increase of 3.7% on the same period of 2013, which Mr Andersen said was “in line with the market” and, critically, its average freight rate per feu improved slightly to $2,679 per 40ft while its unit costs continued to decline.
The average price per tonne of bunkers paid by the carrier in the period was $575. The price of heavy fuel oil has fallen by 25% to around $440 per tonne;, and if this situation is maintained, and freight rates hold steady, Maersk Line could comfortably exceed its $2bn full-year profit forecast.
However, in a Q&A session following the results teleconference, Mr Andersen was not optimistic that carriers would hang on to the benefits of lower bunker prices for long.
He said the competitive nature of the industry meant carriers would “probably compete this away”, ending up with price reductions.
Mr Andersen said the 2M vessel sharing agreement between Maersk Line and MSC would start as planned in January, and bookings would be accepted from next month.
The group “did not foresee any problems” from the European or Chinese regulators and Maersk Line would endeavour to comply with the self-regulating requirements of the VSA.
He said the 2M would mean a stronger network for customers and further fuel and optimisation savings, given the increase in the average size of vessels deployed.
APM Terminals recorded a profit of $345m, but that figure was inflated by $219m from the sales of its Virginia, US, facility and the 50% share in Terminal Porte Oceane, Le Havre.
APMT processed 9.7m teu in the period, compared with 9.3m teu in the third quarter of 2013, and for the nine months of 2014 handled 28.9m teu at its terminals around the world, representing a 7% increase on the previous year.
Maersk said the Ebola outbreak in Liberia was being “closely monitored”, with the port of Monrovia, operated by APMT, remaining “open and in full operation”.
The group’s forwarding arm, Damco, is in the midst of a root and branch restructure and the company said “significant one-off costs are putting additional downward pressure on the quarterly result” – this showed a loss of $68m for the period.
Indeed, the scale of the cuts at Damco were revealed by Mr Andersen, who advised that its 300 offices worldwide had been reduced to a core 50.
Although supply chain management volumes “continued to develop positively” for Damco – up by a quarter-on-quarter 14% – the impact of the radical restructure cost the 3PL 7% of its ocean freight volumes and 16% of its airfreight business, compared with the same quarter of last year.
Meanwhile, Svitzer, the towage and salvage division of Maersk, had a challenging quarter, posting a profit of $23m, down from $34m for the same quarter of 2013, the consequence of a “poor salvage market” and strong competition in the Australian harbour towage sector.
Chief executive Nils Andersen, said the group was “very satisfied” with a result that represented a return on sales of 12.7%, and that it was “well positioned to take advantage of opportunities materialising”.
Mr Andersen said there was “some caution in relation to the market for the coming quarters” and conservatively maintained the full-year profit outlook for the group at $4.5bn.
Maersk Line transported 4.8m teu in the quarter, an increase of 3.7% on the same period of 2013, which Mr Andersen said was “in line with the market” and, critically, its average freight rate per feu improved slightly to $2,679 per 40ft while its unit costs continued to decline.
The average price per tonne of bunkers paid by the carrier in the period was $575. The price of heavy fuel oil has fallen by 25% to around $440 per tonne;, and if this situation is maintained, and freight rates hold steady, Maersk Line could comfortably exceed its $2bn full-year profit forecast.
However, in a Q&A session following the results teleconference, Mr Andersen was not optimistic that carriers would hang on to the benefits of lower bunker prices for long.
He said the competitive nature of the industry meant carriers would “probably compete this away”, ending up with price reductions.
Mr Andersen said the 2M vessel sharing agreement between Maersk Line and MSC would start as planned in January, and bookings would be accepted from next month.
The group “did not foresee any problems” from the European or Chinese regulators and Maersk Line would endeavour to comply with the self-regulating requirements of the VSA.
He said the 2M would mean a stronger network for customers and further fuel and optimisation savings, given the increase in the average size of vessels deployed.
APM Terminals recorded a profit of $345m, but that figure was inflated by $219m from the sales of its Virginia, US, facility and the 50% share in Terminal Porte Oceane, Le Havre.
APMT processed 9.7m teu in the period, compared with 9.3m teu in the third quarter of 2013, and for the nine months of 2014 handled 28.9m teu at its terminals around the world, representing a 7% increase on the previous year.
Maersk said the Ebola outbreak in Liberia was being “closely monitored”, with the port of Monrovia, operated by APMT, remaining “open and in full operation”.
The group’s forwarding arm, Damco, is in the midst of a root and branch restructure and the company said “significant one-off costs are putting additional downward pressure on the quarterly result” – this showed a loss of $68m for the period.
Indeed, the scale of the cuts at Damco were revealed by Mr Andersen, who advised that its 300 offices worldwide had been reduced to a core 50.
Although supply chain management volumes “continued to develop positively” for Damco – up by a quarter-on-quarter 14% – the impact of the radical restructure cost the 3PL 7% of its ocean freight volumes and 16% of its airfreight business, compared with the same quarter of last year.
Meanwhile, Svitzer, the towage and salvage division of Maersk, had a challenging quarter, posting a profit of $23m, down from $34m for the same quarter of 2013, the consequence of a “poor salvage market” and strong competition in the Australian harbour towage sector.
No comments:
Post a Comment