Live from Sea Asia 2019

The Seatrade Maritime News reporting team bring you all the key stories in the run-up to, and live on the ground during, Sea Asia 2019 in Singapore from 9 – 11 April.

AP Moller – Maersk remains in the red in Q1

Container shipping and logistics giant AP Moller – Maersk remained in the red in Q1 with a $104m loss, although results were improved despite a weaker box shipping market.

Maersk’s Q1 2019 loss of $104m compared to $311m loss in the same period in 2018, once changes to accounting policies to IFRS 16 and the reintegration of Maersk Supply Service (MMS) previously classed as discontinuing operations, were taken into account. Revenues grew by 2.5% to $9.54bn in the first quarter of the year.

Read more: AP Moller – Maersk give up trying to sell offshore supply vessel arm

EBITDA for its core ocean, or container shipping, business grew by 42% to $927m in Q1 this year compared to the same period in 2018. The improved result was primarily driven by an average load freight rate of $1,903 per feu, up from $1,832 per feu a year earlier, along with total operating costs that declined by 2.8%.

Improved rates came despite weaker growth in global container volumes of 1.7% in Q1 compared to average full year trade growth of 3.6% in 2018. For 2019 as whole the container trade is projected to grow 1 – 3%.

Looking ahead Maersk has now completed its restructuring selling its oil and tanker businesses, spinning off its rig business as a separate listed-business, and bring supply vessel owner MSS back into the company having failed to find a solution for it in current market conditions.

Read more: Maersk Drilling to be demerged from AP Moller – Maersk, listed on Nasdaq Copenhagen

“We made good progress on the transformation, where we have completed the separation of the energy businesses, further integrated our organisation and continued to improve our product portfolio,” commented Soren Skou, ceo of AP Moller – Maersk.

Non-ocean business revenue grew by 3.8% in Q1, after adjustment for the closing of production facilities in Maersk Container Industry, and logistics & services improved gross profit by 2.2%. “Non-ocean revenue and gross profit in logistics & services grew, but needs to accelerate in the coming quarters,” Skou said.

The company maintained its full year guidance of EBITDA of $5bn.

“We reaffirm our guidance for the 2019 results. We are still facing considerable uncertainties from weaker macro numbers as well as the risk from trade tensions and implementation of IMO 2020,” Skou said.

“In Q1, volumes on trans-Pacific trade between Asia and North America have shown signs of decline and new tariffs can potentially reduce expected growth in global container volumes by up to 1 percentage point.”

Posted 24 May 2019

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Marcus Hand

Author Bio ▼

Editor, Seatrade Maritime News Marcus Hand is the editor of Seatrade Maritime News and a dedicated maritime journalist with nearly two decades of experience covering the shipping industry in Asia. In addition to running Seatrade's maritime and offshore news website based from Singapore he is the Asia Editor of Seatrade Maritime Review. Marcus is also an experienced industry commentator and has chaired many conferences and round tables. Prior to joining Seatrade at the beginning of 2010 Marcus worked for shipping industry journal Lloyd's List for a decade and previous to that the Singapore Business Times covering shipping and aviation.

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