Maersk Line sees Q2 profit dip as average freight rates fall 14.1%

The Danish shipping line said it made a $507m net profit in the second quarter of 2015 compared to a $547m in the same period a year earlier. For the first half of 2015 Maersk reported a higher net profit of $1.22bn, compared to $1bn in the first half or 2014, driven by a strong first quarter this year.
Revenues in the second quarter of 2015 also declined to $6.3bn compared to $6.9bn a year earlier.

Maersk noted a “sharp decline” in average freight rates in the second quarter with a 14.1% drop equaling an average rate of $2,261 per feu. “The freight rate decline was largely attributable to bunker cost savings being passed through to the customers and to deteriorating market conditions on the Asia-Europe trade,” the company said.

A soft growth in demand in Q2, estimated at 1 – 2% was primarily due to weak imports into Europe Maersk noted.

The continer line has completed delivery of all 20 of its 18,000 teu, Triple-E vessels, with five delivered in the second quarter. The line ordered 11 more 19,630 teu second generation Triple-E vessels in June this year for delivery in 2017 – 18.

Looking ahead to the year as a whole Maersk continues to expect to report a higher underlying profit for 2015 compared to the $2.2bn it made in 2014 despite a contraction in expected demand growth. “Global demand for seaborne container transportation is revised to an expected increase by 2-4% versus previously by 3-5%,”it said.