AP Moller-Maersk reports ‘unsatisfactory earnings’ in first quarter

17 / 05 / 2018

  • Søren Skou

AP Moller-Maersk saw its revenue rise by 30% year-on-year in the first quarter of 2018 to reach $9.3bn.

That year-on-year revenue improvement figure would be 10% if shipping line Hamburg Süd – which was acquired at the end of 2017 – was taken out of the figures, but there was growth “in all business segments”.

The non-ocean-based businesses of the Denmark-based transport and logistics company reported revenue growth year-on-year, including 6% in the Logistics & Services segment.

However, Logistics & Services reported slightly lower earnings before interest, taxation, depreciation and amortisation (EBITDA) of $23m, down from $32m in the first quarter of 2017.

Søren Skou, group chief executive, said: “In the first quarter of 2018, we reported a 30% revenue growth and the integration of the business is well underway with a successful start to the Hamburg Süd integration.

“At the same time, on the short-term performance, our result especially in the ocean-related part of the business was unsatisfactory.

“In response to the current challenging market conditions we are implementing a number of short-term initiatives to improve profitability and we reiterate our guidance for 2018.”

EBITDA across the company increased by 5% to $669m, negatively impacted by adverse rates of exchange compared to the same period of last year.

The underlying result for AP Moller-Maersk after financial items and tax of minus $239m may have been deemed “unsatisfactory”, but the company reiterated its expectations for the whole of this year of an underlying profit of $356m, above the figure for 2017, while nevertheless noting increased uncertainties due to geopolitical risks, trade tensions and other factors adversely impacting freight rates and rates of exchange.