Maersk Profit Rises As Unwanted Oil Business Drives Earnings
Shipping giant A.P. Moller-Maersk A/S reported a 16 percent advance in first-quarter profit, helped by better performance in the energy division that it’s planning to divest.
Denmark’s biggest company recorded net income of $245 million in the first three months of the year, missing the average estimate of $275 million in a Bloomberg survey of 10 analysts. Group revenue rose 5 percent to $8.96 billion, the Copenhagen-based company said in a statement Thursday.
Maersk has given itself an end-of-2018 deadline to come up with a plan to separate its energy units, which include Maersk Oil and Maersk Drilling. The conglomerate wants to focus on its transport divisions, including Maersk Line, the world’s largest container carrier.
Maersk said it still expects the global container market to grow 2-4 percent in 2017 and that the liner unit will improve its underlying result by more than $1 billion compared with 2016. Still, Maersk Line reported an underlying loss of $80 million in the quarter, hurt by weak freight rates on north-south trade.
“Whilst we cannot be satisfied with the overall profitability in the first quarter, the result is as expected and we reiterate our guidance for the year for the group,” Chief Executive Officer Soren Skou said in the statement.
Maersk Oil, which mainly operates in the North Sea, reported an underlying profit of $292 million compared with a $29 million loss a year earlier. Maersk said the unit’s performance was helped by a higher oil price, lower costs, reduced exploration costs and a one-off tax income of $42 million.