Maersk Line reported net loss in 2016

Maersk container shipThe world’s largest container shipping carrier Maersk Line reported net loss in 2016, registering a negative financial result for the second time in decades. The company finished the year on red with net loss of 376 million USD, despite of the improving container shipping markets. Maersk Line reported revenues decrease of 13% to 20.7 billion USD, driven by an 18.7% decline in average freight rates to 1,795 USD per TEU. However, the company reached 9.4% increase in container volume to 10.4 million TEU, which partially offset the effect of poor rates that fell to record levels in the first quarter of 2016.

“In the fourth quarter, the net addition of nominal capacity went down significantly — much less deliveries and record scrapping led to demand exceeding supply, and it looks like this will continue at least for another few quarters”, said the CEO of Maersk Line, Soren Skou. “We believe the industry is at an inflection point and we see encouraging signs for 2017, and that is why we feel comfortable with improving the Maersk Line profits by 1 billion USD over the 2016 result”, added he.

However, Maersk Line forecasting that its 2017 profit will be a 1 billion USD improvement on the negative 2016 results.

Overall, the AP Moller Maersk Group reported a 1.9 billion USD loss in 2016, compared to a 0.925 billion USD profit in 2015. The largest contribution to the negative result are the write-off of assets and significant impairments at Maersk Drilling and Maersk Supply Service.