Maersk Line to slash 4,000 jobs by end-2017

Maersk Line, the world's number one container shipping firm, said Wednesday it would cut 4,000 jobs by the end of 2017 and defer vessel investments to buoy up its dominant position in a falling market.

Maersk Line to slash 4,000 jobs by end-2017
Photo: Claus Fisker/Scanpix
The maritime division of Danish conglomerate A.P. Moeller-Maersk has been battling price and demand falls and is cutting capacity and has warned that a fall in activity will hit annual results due for publication Friday.
Late last month, petroleum division Maersk Oil announced it would slash its workforce by between ten and 12 percent in the face of low oil prices.
“We are in the process of transforming Maersk Line, to make the organisation simpler and leaner. We want to improve the online experience of clients and at the same time work as efficiently as possible,” said chief executive Søren Skou in a statement.
Maersk Line is to slash administrative costs by $250 million (1.7 billion kroner) over two years.
With the downturn in the market Maersk Line is also cutting back its fleet expansion, dropping plans to purchase six giant vessels on which it had placed an option.

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Maersk profits up as global supply chain disrupted

Danish shipping giant, AP Møller-Maersk, said Tuesday that profits were up sixfold in the third quarter as the coronavirus pandemic and global supply chain problems caused container prices to soar. 

Maersk headquarters in Copenhagen. The Danish shipping company posted hefty profits in the third quarter of 2021.
Maersk headquarters in Copenhagen. The Danish shipping company posted hefty profits in the third quarter of 2021. Photo: Niels Christian Vilmann/Ritzau Scanpix

“Maersk delivered record earnings” in the third quarter, chief executive Soren Skou said.

“In the ongoing exceptional market situation, with high demand in the US and global disruptions to the supply chains, we continued to increase capacity and expand our offerings to keep cargo moving for our customers.” 

Maersk said that its bottom-line net profit amounted to $5.438 billion in the period from July to September, compared with $947 million a year earlier.

Underlying, or operating, profit increased nearly fivefold to $5.859 billion and revenues jumped by 67 percent to $16.612 billion.

“Results in Q3 were driven by high freight rates in an exceptional market situation,” the group said.

Looking ahead, Maersk said it is sticking to its full year forecast for operating profit of 18-19 billion dollars. 

However, the ocean shipping division “is now expected to grow below” projected global container demand of between seven and nine percent this year, “subject to high uncertainties related to the current congestion and network disruption,” Maersk said.

“The current trading conditions are still subject to a higher-than-normal uncertainty due to the temporary nature of current demand patterns, disruptions in the supply chains,” it cautioned.

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