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July 8, 2010, 9:08 p.m. EDT

Maersk lifts earnings outlook amid signs of shipping revival

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By Ian Edmondson

In the latest sign of revival in the container-shipping industry, A.P. Moller-Maersk AS, the world's largest container-shipping company, raised its full-year earnings forecast, saying it now expects to make more than it did two years ago.

The company's container business has grown more than expected and is likely to push this year's profit above the $3.5 billion that Maersk recorded in 2008, the company said Thursday. The Copenhagen-based company reported a net loss of $1.31 billion last year.

The company noted there is still considerable uncertainty in its forecast which assumes freight rates, oil prices and the U.S. dollar exchange rate will remain stable.

Maersk said the revision from March—when it had forecast only "a modest profit"—includes a gain from the sale of shares in the Yantian terminal in China, but excludes a possible gain from the sale of Netto Foodstores Ltd. because that deal still is subject to the approval of the U.K. competition authorities.

"The turnaround in the container shipping industry has been significant; you can see that by the lack of spare equipment to transport goods," said Henrik Bruenniche Lund at Carnegie, which rates the stock at "outperform."

Maersk's improved outlook comes just two days after Germany's TUI /zigman2/quotes/206714402/delayed DE:TUI1 -12.05% AG raised its guidance for its container-shipping operations, citing a recovery in global container shipping.

Last week Taiwan's Evergreen Group said it had placed an order for 10 ships capable of carrying 8,000, 20-foot containers, the company's first orders for new vessels since 2003. The order from the parent of Taiwan's largest container shipper by revenue, Evergreen Marine Corp., is another indication the container-shipping industry is recovering.

Rebounding global demand and aggressive measures to reduce supply in the industry, including idling of ships, have helped container lines increase freight rates and recover some of the losses they have incurred since 2008.

Hilde Arends in Frankfurt and Alex Pevzner in Taipei contributed to this article.

/zigman2/quotes/206714402/delayed
DE : Germany: Frankfurt
4.05
-0.55 -12.05%
Volume: 885,456
Jan. 22, 2021 7:59p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
N/A
Rev. per Employee
€282,968
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