AP Moller-Maersk beat first-quarter net profit forecasts on Thursday, boosted by the energy business it plans to spin off, but also reported signs of improvement at its long-suffering container shipping business.
Shares in the Danish conglomerate climbed almost 5 per cent after it said a gradual recovery in freight rates should boost earnings at Maersk Line, the world’s biggest container shipping business, over the rest of the year.
Maersk has been hit by the double blow of low oil prices at its energy arm and sliding prices in its shipping business due to lacklustre global trade and industry overcapacity.
Although higher fuel costs saw Maersk Line report a loss of $66 million in the first quarter, Skou said demand had been better than expected and the group’s forecast for 2-4 per cent growth in global demand for seaborne container transportation this year may prove too conservative.
Maersk reported a first-quarter net profit of $253 million, above analysts’ average forecast.
The energy business swung to a profit of $328 million from a loss of $29 million in the same quarter a year ago, helped by higher oil prices and cost cutting.
Maersk repeated its guidance for a full-year group underlying profit above the $711 million achieved in 2016. – (Reuters)