Maersk raises outlook after strong second quarter

COPENHAGEN, Hovedstaden: Danish shipping and oil conglomerate A. P. Moeller-Maersk raised its 2013 earnings forecast on Friday after registering a much better-than-expected second quarter.
The group’s net profit fell by 15 percent to 4.48 billion kroner (601 million euros, $801 million) in the April to June period, but that figure was significantly higher than the 3.05 billion anticipated by analysts surveyed by Dow Jones Newswires.
Sales slid by nine percent to 80.9 billion kroner, owing primarily to a drop in oil production and prices as well as shipping freight rates, which were down by 13 percent on average.
In the container transport business, where Maersk Line is the world’s biggest operator, “the global market showed only modest growth,” mainly because of the economic crisis in Europe, the group said in a statement.
Volumes rose by 2.0 percent and Maersk tried to cut costs by maximising the use of its vessels.
“The outlook for container transportation remains challenging as demand is expected to continue to be weak in 2013,” it added.
In its oil unit, Maersk Oil, daily production plunged by 21 percent from a year ago.
It fell in Qatar, Denmark, where the group encountered technical problems, and Britain, but was stable in Algeria, Brazil and Kazakhstan.
The company said oil production had “bottomed out now and will return to growth in the second half of the year.”
The two units together account for 60 percent of A.P. Moeller Maersk’s sales.
The group raised its net profit forecast for the full-year to $3.3 billion, up from the 2.9 billion previously expected.
That is however lower than the 4.0 billion the group reported in 2012.
Friday’s earnings report cheered investors, as the share price climbed by 6.97 percent in early afternoon trading on a Copenhagen stock exchange that was largely flat.