Maersk Line returns to Profits in Q2 2017, reports USD 339 million profits

Posted by Daily Shipping Times on 18-08-2017        Tweet

COPENHAGEN : Danish container shipping major Maersk Line returned to profit, CEO of A.P. Moller - Maersk A/S, Soren Skou, said announcing the group's results for the second quarter of 2017.

“Maersk Line is again profitable delivering in line with guidance, with revenue growing by USD 1bn year-on-year in the second quarter. The profit was USD 490 million higher than the same quarter last year, based on higher rates,” Skou said.

The company reported a profit of USD 339 million for the second quarter of 2017, against a loss of USD 151 million in the second quarter of 2016 with a positive ROIC of 6.7%, which bounced back from negative RIOC of 3.0%.

The underlying result was a profit of USD 327 million, also a major return from a loss of USD 139 million booked in the corresponding period a year ago.

Improved results were ascribed to a recovery of market fundamentals during the quarter as demand growth of 4% outgrew nominal supply growth of 1.4%.

Maersk said that the improvement has led to 22 % higher freight rates compared to Q2 2016 and 7.6% compared to Q1 2017.

Specifically, freight rates rose by 36% on East-West trades and 17% on NorthSouth trades.

“Transported volumes increased by 1.7% compared to Q2 2016. Volume grew on headhaul by 5.2%, however, offset by a decrease on backhaul by 5.6% as backhaul cargo was less attractive on some trades,” the carrier further added.

In its guidance for 2017, Maersk Line reiterated the expectation of an improvement in excess of USD 1 billion in underlying profit compared to a loss of USD 384 million in 2016, mainly due to improvements in freight rates and partly increasing volumes.

As disclosed, global demand for seaborne container transportation is still expected to increase 2-4%, but in the upper end of the range.