Maersk Group profit plunges

CEO Søren Skou: "The result is unsatisfactory" CEO Søren Skou: "The result is unsatisfactory"

AUGUST 12, 2016 — Hit by low average container freight rates and low oil prices, Maersk Group delivered a second quarter profit of $118 million compared with $1.1 billion in the same quarter last year. The return on invested capital (ROIC) was 2.0% (10.2%).

The underlying profit for the group of $134 million ($1.1 billion) was significantly lower than for the same period last year for all businesses except Damco.

"The result is unsatisfactory," said Søren Skou, who replaced Nils S. Andersen as Mae

rsk Group CEO on June 23. "Cost reductions and operational optimizations, however, made a significant contribution to mitigating the impact of the negative market conditions. Maersk Oil has reduced operational costs by 25 percent, upholding a break-even at $40-45 per barrel. The costs in Maersk Line have been reduced to an all-time low level and are under $2,000/FFE for the first time. Our financial position remains strong with a liquidity reserve of $11.5 billion. The Group's expectation for 2016 of an underlying result significantly below last year is unchanged. To ensure the future strength, profitability and development of new growth opportunities of the company, the Board of Directors have initiated a strategic review of the company and will report on progress of the review before the end of Q3, 2016."

Read the second quarter report HERE

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