Lower Bunker Costs, Higher Volumes Help Maersk Line in Q1

by Ship & Bunker News Team
Thursday May 22, 2014

The world's largest container shipping group, Maersk Line, reports it more than doubled its profits to $454 million in the first quarter of the year, up from $204 million in Q1 2013, as lower bunker prices helped make up for falling freight rates.

The company paid an average of $581 per metric tonne (pmt) for fuel over the quarter, down from $626 pmt a year earlier, while the average freight rate dropped to $2,628 per forty-foot equivalent units (FEU) from $2,770 per FEU in Q1 2013.

Unit costs fell to $2,612 per FEU from $2,871 a year earlier, and volumes rose 7.3 percent to 2.2 million FEU, while the reversal of a $72 million impairment charge also helped the bottom line.

The company also attributed the improvement partly to network efficiencies and improved vessel utilisation.

Overall, Maersk Line parent company A.P. Møller - Mærsk A/S (Maersk) reported a 1 percent increase in revenues to $11.7 billion, while profits rose to $1.2 billion from $710 million in Q1 2013.

Maersk Line, which had previously predicted full-year results in line with 2013's $1.5 billion profit, now says it expects to outpace the previous year.

The company also said it now expects the P3 alliance of Maersk Line, Mediterranean Shipping Company S.A. (MSC), and CMA CGM to start operations in the fall of 2014.

Maersk Line's $1.5 billion profits in 2013 already represented more than triple the previous year's results, as the company benefitted from lower bunker prices and greater efficiencies.

Ship & Bunker News Team
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