09 November 2015

[091115.EN.SEA] Maersk Line Q3 Profit Plunges 61pc

THE world's biggest container line, Maersk Line, reported a profit of US$264 million for the third quarter of the year, a drop of 61 per cent from $685 in the same period last year.

The Danish shipping giant blamed rising overcapacity and "historically low level" box freight rates for the earnings decline.

"Global container demand is expected to have grown by 0-1 per cent, whereas the global container fleet grew by almost 9 per cent. Container freight rates declined significantly across all trades expect North America, and especially Maersk Line's key Europe trades were impacted severely," the shipping line said in a statement.

Third quarter revenue fell by 14.9 per cent compared to Q3 2014 to slightly more than $6 billion due to an average freight rate decline of about 19 per cent to $2,163 from $2,679 per FEU.

However, Maersk Line's traffic for the three-month period to September increased 1.1 per cent from 4.80 million TEU to 4.85 million TEU.

The shipping line's earnings decline was responsible for halving the parent Maersk Group's third quarter profit to $778 million from $1.6 billion in 2014.

Last week, the shipping line announced that it would cut 4,000 of its 23,000 shore-based jobs and reduce its network capacity.

In addition, the carrier had earlier cut its profit forecast for the year by $600 million down to $1.6 billion from $2.2 billion.


Source : HKSG.

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