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Current Position:Home » News » General News » Topic

Maersk Q3 profit falls 44%

Zoom in font  Zoom out font Published: 2016-11-04  Views: 26
Core Tip: Moller-Maersk's container business, on which it is staking its future, made a loss in the last three months as freight rates declined further, reports Reuters.
Moller-Maersk's container business, on which it is staking its future, made a loss in the last three months as freight rates declined further, reports Reuters.

Shares in the Danish company fell 9 percent after third quarter profit fell 44 percent and came in below forecasts. Low oil prices have depressed returns from the energy business, which is the other main arm of the company.

The results underline the problems facing the family-controlled group which said in September it would focus its attention on building up its transport and logistics business, while creating a separate energy division.

The company stuck to its forecast for annual profits to be significantly below last year's $3.1 billion.

"This is far from a satisfactory result for us," said Soren Skou, who was appointed chief executive of the group in June and still heads the container business.

"We grew more than the market and gained some market share in the third quarter," said Skou, adding that Maersk managed to increase market share following the collapse of South Korea's Hanjin Shipping.

However, Maersk said average freight rates fell 16 percent in the quarter to $1,811 per 40-foot container, as overcapacity hurts shipping companies.

A net loss of $116 million for its container unit, against analysts' expectations of a $174 million profit, shows the pressures as it seeks to remain the world's leading container shipping carrier amid a wave of mergers and acquisitions.

Recent deals have involved China's COSCO, France's CMA CGM and Germany's Hapag-Lloyd.

Japan's top three shipping firms, Kawasaki Kisen, Mitsui O.S.K. Lines and Nippon Yusen, said on Monday they planned to combine their container shipping operations in a joint venture that will have $19 billion in combined revenues and control 7 percent of global container capacity.

Maersk has a market share of around 15 percent but has been unable to secure better prices for shipping goods.

Net profit fell to $438 million for the three months to Sept. 30, below the $490 million expected by analysts in a Reuters poll.
 
keywords: Maersk COSCO
 
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