A.P. Moller-Maersk today reported a 27.2 percent rise in group net profit for the first nine months of 2007 to Danish Krone14.45 billion ($2.60 billion) helped by a rebound in its container shipping and related activities division.
Group profit before financial items and tax (EBIT) for the nine months gained 22.6 percent to DKr34.53 billion ($6.22 billion) while revenue improved 7 percent to DKr205.42 billion ($36.97 billion).
It is the first time the Danish group has ever released results after three quarters of the year.
"The net result shows improvement for the group as a whole," said Nils S. Andersen, group chief executive officer, making his first official statement since starting in the role on Nov. 5.
"The container business is showing increased profitability, although the result is still far from satisfactory. The group's net result is also affected positively by gains on sales of ships and rigs in Maersk Tankers and Maersk Contractors and improved earnings in Maersk Supply Service.
"Despite a higher production of oil and gas compared to 2006, the net result for the oil and gas activities is below that of the same period last year due to increased exploration activities, a higher level of depreciation, and increased taxes. The group's total result is improving, which gives us a good basis for a continued focus on creating progress," Andersen said.
Container shipping and related activities turned a positive EBIT of $626 million after three quarters, compared to a loss of $125 million in comparable period in 2006.
Maersk Line and sister company Safmarine transported a total of about 5.1 million FEUs in the nine months, up from 5 million FEUs a year ago. The company said that during that period Asia/Europe volumes rose 18 percent while Asia/United States volume declined 17 percent.
The average freight rates, including bunker adjustments, were about 3 percent higher. Fuel costs are roughly 45 percent higher now than the average price of the first three quarter of 2006, Maersk said.
The results for APM Terminals, which is included as part of the container division, were on the same level as last year due to increased funding and start-up costs of new terminals, the company said. APM's volume for the period increased 16 percent.
For the year, Maersk expects its container division to post a "minor positive result" which would still represent a significant improvement over the $568 million loss incurred in 2006.
The company said EBIT after nine months from tankers, offshore and other shipping activities was level with the same period last year while oil and gas activities "was somewhat higher" due to higher production in the United Kingdom and a larger share of production in Qatar, although production in Denmark was down.
Odense Steel Shipyard realized a "significant negative result" in the period but better than last year.
For the full year 2007, Maersk maintained its guidance given in late August and expects group revenue of about $50 billion and profit to be about 20 percent more than the $2.7 billion it earned in 2006.
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