The Danish ocean carrier’s strong performance in first half of 2015 stands in sharp contrast to the same period in 2009, according to Maersk Line CEO Soren Skou.
Maersk Line has built a business that is “truly resilient and profitable” in a tough and volatile industry, said Soren Skou, the container carrier’s chief executive officer.
He was one of a dozen speakers from various companies in the A.P. Moller Maersk conglomerate who spoke during the company’s annual “capital markets day” on Wednesday.
Skou said one way to illustrate Maersk Line’s resilience is to compare its performance in the first half of 2015 with its performance in the first half of 2009.
He said market conditions were similar – freight rates were just 4 percent higher in the first half of 2015 than in the first half of 2009 ($2,370 per FEU v. $2,288 per FEU), and bunker prices were 27 percent higher ($346 per ton v. $272 per ton).
Yet Maersk was able to make a net operating profit after taxes (NOPAT) of more than $1.2 billion in the first half of the year and achieve a return on invested capital (ROIC) of 12.2 percent compared with recording a NOPAT of negative $995 million and negative ROIC of 11 percent in the first half of 2009.
Having lower costs than competitors and a strong network and brand has given the Maersk advantages that Skou said can be used to overcome “both the poor industry fundamentals that we have to deal with, but also the headwinds you see right now in the market.”
“Going forward we think Maersk Line will continue to create value by being able to price competitively to grow share, and still deliver the returns at our thresholds, our objectives and also to generate to sufficient cash to invest in growth,” he said.
Skou: Maersk Line has proven its resilience
