"We are ready to take more territory, especially in emerging markets," he adds.
Maersk Group revenue for the nine month period ended September 30, 2010 increased by 17 percent to $41.4 billion, primarily as a result of higher container shipping freight rates and higher oil prices. The net result for the period was a profit of $4.2 billion compared with a loss of $0.7 billion in the same period last year
"The result is exceptional, and we are very satisfied," says Group CEO Nils S. Andersen. 'Markets have been favorable, but first of all, our businesses are in excellent shape. Especially our container business has improved and is ahead of competition on profitability. We have moved from defense to the attacking zone, and we are ready to take more territory, especially in emerging markets."
Container shipping and related activities turned a profit of $2,254 million (against a loss of $1,590 million in the equivalent period last year). The result reflected an increase in average freight rates of 34 percent, an increase in transported volumes of 7 percent and substantial savings per unit.
APM Terminals' segment result was $668 million ($340 million), helped by gains on sale of an ownership interest in Sigma Enterprises Ltd. The number of containers handled increased by 3 percent despite discontinued activities at six terminals. The remaining terminals had an 8 percent increase in volumes.
Oil and gas activities turned in $1,339 million ($958 million), primarily due to a 35 percent increase in oil prices to an average of $77 per barrel. The increase more than compensated for a 17 percent decline in the Group's share of oil and gas production to 103 million barrels. The Group's exploration costs were $346 million ($466 million). Exploration activities led to two new discoveries in Norway in the third quarter. Planned maintenance of platforms in the North Sea was completed in the third quarter.
Maersk Tankers' segment result was a loss of $103 million in the first nine months of 2010 (same period loss last year was $193 million). Maersk Tankers incurred impairment losses of $107 million in the third quarter of 2010.
Maersk Drilling's segment result increased to $300 million ($168 million), positively affected by delivery of new rigs and a continued high level of contract coverage at attractive rates.
Group] free cash flow increased by $6.3 billion in the first nine months of 2010 compared to the same period of 2009. Cash flow from operating activities was $7.4 billion ($4.1 billion), while cash flow used for capital expenditure was negative by $3.2 billion (negative by $6.3 billion). Net interest bearing debt was reduced by $4.4 billion to $13.7 billion.
Group competitiveness was enhanced by further cost reductions and activity adjustments with an expected full-year effect of between $500 million and $1 billion.
Outlook for the full year 2010
The group is now expecting a result for the full year in the order of $5 billion, excluding an expected gain from Dansk Supermarked A/S' sale of Netto Foodstores Limited, UK. That transaction is not expected to be completed until the first half of 2011.
November 10, 2011