Maersk Cuts Profit Outlook on Weaker Global Container Market
Maersk Cuts Profit Outlook on Weaker A.P. Moeller-Maersk cut its profit outlook for 2015 citing a weaker global container shipping market.
The owner of the world’s biggest shipping line said it now sees underlying profit of about $3.4 billion, compared with a previous forecast for $4 billion, according to a statement to the stock exchange on Friday.
“Particularly the container shipping market deteriorated beyond the Group’s expectations especially in the latter part of the third quarter and October,” the company said. “The Group now expects no market recovery within 2015. Initiatives have been taken to adjust Maersk Line’s network accordingly.”
The company’s shares opened more than 7 percent lower and traded 7.4 percent down at 9,700 kroner as of 9:04 a.m. in Copenhagen. That’s their weakest level since September 2013. Nordea said the profit warning wasn’t unexpected, but bigger than estimated, according to a note published by senior equity specialist Jesper Grandjean Bamberger.
Container rates have been falling amid concern that China’s economic growth is slowing. Bloomberg Intelligence said on Friday that the World Container Index touched a record low for a third straight week, with two of the eight trade lanes in the rate composite at all-time lows.
Bloomberg News, edited by ESM