HELSINKI – Hit by sharp declines in freight rates and the oil price, Danish shipping and energy group A.P. Moller-Maersk said Wednesday it turned a $2.5 billion loss in the fourth quarter, a big turnaround from the profit of $189 million in the equivalent period a year earlier.
Stock in the company, which is watched as a bellwether for global trade, stock plunged 4 per cent to 7,850 kroner in afternoon trading in Copenhagen.
The world’s largest shipping company said it had written down the value of some of its oil assets by $2.6 billion in light of the sharp fall in the price of oil over the past year and that it expects no improvement in 2016. It cautioned that the full-year result would be “significantly below” 2015.
Still, CEO Nils Smedegaard Andersen said he was satisfied with what he described as a good operational performance over the full year, with the group posting a net profit of $925 million, down 85 per cent from $5.2 billion in 2014. Revenue fell 15 per cent in the full year to $40.3 billion.
“Despite the very challenging market conditions in our industries, all business units delivered positive underlying profits,” he said.
The group said that after a satisfactory result in the first half of the year it was “severely impacted by a widening supply-demand gap across most of our businesses.”
Maersk Oil made a loss of $2.1 billion in 2015 compared to a loss of $861 million a year earlier, and the company said it expects “a negative underlying result” in the sector in 2016.
Maersk employs some 90,000 people in 130 countries.