Maersk tightens belt despite profit

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Maersk tightens belt despite profit

Maersk will close a centre in China and possibly lay up ships, despite reporting a profit for the first three quarters

Maersk tightens belt despite profit

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Maersk’s profit this year is in contrast to a US$57m loss over the same period last year. The boost was caused by big rises in freight rates and a growth in cargo volumes, according to Pacific Shipper.

Volume is looking to decrease, however, as importers worldwide cut back on spending in the face of economic uncertainty.

Improving profitability of the shipping line is a top priority, according to Nils Andersen, chief executive of parent company AP Moller-Maersk.

He said the company had done better than it had thought at the halfway stage, but “there is still a long way to go to get an adequate return on investment.”

In an effort to whittle down costs, Maersk announced it would close its Guangzhou global service centre, one of two in China, by mid-2009. Its Shenzhen facility would expand to take up the slack.

The shipping line also said it was “very likely” to park ships in the coming year as freight volumes fall, according to the company’s chief executive Eivind Kolding.

Mr Kolding said the ships would be withdrawn in the first half of 2009, and predicted zero growth in the container shipping market next year.

Maersk suspended two of its Asia-Europe services earlier this year, one this month and one in June, cutting the line’s capacity on the route by about 10 per cent from last year.

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