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Maersk braces for profit drop

Maersk braces for profit drop

Copenhagen: A.P. Moeller-Maersk A/S, the Danish owner of the world's largest container-shipping line, said profit will be "significantly" lower this year as freight rates and oil prices decline, writes Boomberg.

Net income in 2008 fell 4.8% to 17bn kroner ($2.86bn) from 17.8bn kroner a year earlier, the Copenhagen-based company said in a statement, adding that sales rose 12% to 311.8bn kroner.

Maersk Line, which owns more than 470 vessels that can carry a total of 1.9m containers, has lost money as it struggles to adjust to the global economic slowdown and increased competition on trade routes. The container market will contract this year, Maersk said, adding that volumes dropped 20% in January from a year earlier, it said.

"The difficult trading conditions we've been facing since the start of 2009 will put severe pressure on our business," ceo Nils Smedegaard Andersen said in a separate statement. "But we are determined to emerge from the global crisis as a winner."

The shipping unit, whose rivals include Mediterranean Shipping Co. and CMA CGM SA, faces an "extremely negative outlook" for container rates, Maersk said.  [06/03/09]