COPENHAGEN: The A.P. Møller-Maersk group has reported a net profit of US$5.2 billion on revenue of $47.56 billion for 2014 – up from US$3.8 billion and US$47.38 billion respectively in the previous 12 months.
The result included a US$2.8 billion gain from the sale of its majority share in the Dansk Supermarked Group partly offset by net impairments of US$3.0 billion, including US$1.7 billion on Brazilian oil assets.
The group's underlying profit – equal to the result of continuing business minus net assets sales and impairments - increased 33 percent to US$4.5 billion compared to the previous 12 months, and the return on invested capital rose from 8.2 percent to 11.0 percent.
Maersk Line increased its net profit from US$1.5 billion to US$2.3 billion due to stronger than expected volumes, lower unit costs and bunker prices, only partially offset by lower freight rates.
While Maersk Oil and Maersk Drilling both finished the year with net profits, APM Shipping Services, which includes the Damco logistics arm, produced a loss of US$230m – up from a US$85 million loss in 2013.
Damco losses totaled US$293 million in 2014, adding to the previous year's loss of US$111 million, on similar revenues of US$3.2 billion. While supply chain management volumes grew 11 percent, airfreight traffic fell 16 percent and ocean volumes dropped six percent as margins in all three segments continued to fall throughout the year. The company cites the launch of a new IT operating platform that proved more complex and therefore more costly than originally planned. As a result, overhead costs remained higher than anticipated although "the restructuring initiatives are expected to strengthen commercial competitiveness and get Damco back to profitable growth in 2015."
This year the group expects an underlying profit "slightly below" US$4 billion - excluding the proposed sale of a 20.5 percent stake in Danske Bank to A.P. Møller Holding, a subsidiary of the A.P. Møller Foundation.
Ane Uggla, chairman of A.P Møller Holding and the A.P. Møller Foundation said: "By acquiring shares in Danske Bank we reinforce the historic relations that have existed since the late 1920s. It is the foundation's intention over time to own 20 percent of Danske Bank. In doing so we wish to preserve Danske Bank's close and longstanding ties to Denmark and provide our support to the [future] positive development in both A.P. Møller-Mærsk and Danske Bank."
Maersk Line is expected to produce an underlying profit of over US$2.2 billion in 2015 from improved unit costs via the 2M Alliance as demand for ocean containers increases "3-5 percent" during the year. The group adds that this forecast "is subject to considerable uncertainty, not least due to developments in the global economy, the container freight rates and the oil price".
