Maersk Line, the container shipping unit of the AP Moller-Maersk (APMM) group in Denmark, has reported a sharp rise in net profit in the first quarter of 2015 despite a drop in volumes and turnover.
Maersk Line’s net profit reached USD714 million in the first quarter of 2015 compared with USD454 million year on year (y/y). Revenues decreased to USD6.25 billion in the first quarter of 2015 from USD6.46 billion y/y.
The company’s ships carried 2.2 million feu in the review period, a fall from 2.24 million y/y.
The average freight rate fell from USD2,628 in the first quarter of 2014 to USD2,493/ feu. However, the average unit cost dropped as well, from USD2,612 in the first quarter of 2014 to USD2,449.
“Maersk Line continues to expect a higher underlying result than for 2014 (USD2.2 billion),” the company said in its quarterly review. “Global demand for seaborne container transportation is expected to increase by 3-5% (per annum) and Maersk Line aims to grow with the market.”
Global container demand is expected to have grown around 1% in the first quarter of 2015 from the final quarter of 2014.
“Maersk Line volumes decreased by 1.6% in the first quarter of 2015, underlining challenging market conditions and a less than satisfactory development in volumes and vessel utilisation,” the company said.
Maersk Line’s strategy remains to grow with the market and also to ensure satisfactory vessel utilisation.
“Especially affected were imports into Europe,” APMM said. “The decline in EUR/USD has had a dampening effect on trade as buyers try to minimise the inflation impact from exchange rates.”
At the same time, carriers have added significant new capacity in the AsiaEurope trade. This contributed to freight rates from Asia to Europe being historically low.
The implementation of the new vessel sharing agreement (VSA) with Mediterranean Shipping Company (MSC) on the EastWest network was completed on 4 April. The phasein of the 193 vessels was executed successfully and with only very few disruptions during the quarter, APM concluded.