Danish transportation and energy group A.P Møller - Maersk A/S (Maersk) has announced that the average fuel price for its container activities was 43 percent lower during the first nine months of 2009 compared to the same period in 2008.
The average fuel price decreased from $541 per tonne between January and October 2008 to $309 per tonne during the same period this year.
In addition to the drop in fuel costs total fuel consumption decreased by 13 percent, Maersk said.
Fuel prices have risen throughout the third quarter of 2009. However, to offset the rising fuel costs, Maersk Line has introduced “
super slow steaming”, which yields considerable fuel savings. This has not only cut Maersk Line’s costs, but also its environmental impact.
However, despite lower fuel costs the segment result after tax for the Group’s container shipping activities was negative by USD 1,550 million in the period 1 January – 30 September 2009, compared to a positive result of USD 367 million during the same period in 2008. The segment result after tax was affected by sales gains of USD 32 million, compared to USD 332 million in the same period of 2008, Maersk said.
The segment result after tax was a loss of USD 592 million in the third quarter of 2009, compared to a profit of USD 99 million in the third quarter of 2008.
Earnings per transported FFE (EBIT per FFE) for
Maersk Line and
Safmarine, excluding gains on sale of ships and non-recurring costs, etc., were negative by USD 296, compared to positive by USD 86 in the same period of 2008.
For Maersk Line and Safmarine, total unit costs per FFE transported, including depreciation and amortisation, were 16 percent lower in the first three quarters of 2009 than in the same period of 2008. Unit costs excluding fuel costs fell by 7 percent.
In the first nine months of 2009, the Group’s container vessels transported 5.1 million FFE (Forty Foot Equivalent container units), compared to 5.4 million in the same period of 2008. In the third quarter of 2009 volumes increased compared to the second quarter, but, at 1.8 million transported FFE, remained 3% lower than in the third quarter of 2008.
In the period 1 January – 30 September 2009, average rates were 30% lower than in the same period of 2008, reflecting the less favourable market conditions and lower
bunker surcharges. Freight rates picked up during the third quarter of 2009, from the very low level at the end of the second quarter. This was attributable to general rate increases as well as peak surcharges, but, at USD 2,318 on average per FFE, rates were nonetheless 32% lower than in the third quarter of 2008. Rising fuel costs more than offset the third-quarter rate increases.
Maersk Oil Trading’s business activities, which involves the purchase of bunkers and lube oil on behalf of A.P. Moller - Maersk Group companies as well as oil hedging activities in Maersk Oil Trading that have not been allocated to segments, have been included in the unallocated Group result for the first three quarters of 2009 at a negative result of USD 141 million before tax and a negative result of USD 114 million after tax, compared to a positive result of USD 81 million after tax in the same period of 2008. The result before tax includes mainly unrealised losses on value adjustment of oil hedging contracts of USD 148 million, Maersk said.
Commenting on the group's results as a whole,
Nils Smedegaard Andersen, Group CEO, said “As expected, the A.P. Moller - Maersk Group was still negatively affected by the challenging market conditions in the third quarter of 2009, particularly in the markets for the Group’s container vessels and tankers. The strong focus on reducing the level of costs continues to yield positive results, and with sales of treasury shares and issuance of bonds we have taken steps to strengthen the A.P. Moller - Maersk Group’s robust financial basis and long-term funding position.”
Outlook for the full year 2009
For container trades, average rates including bunker surcharges for the fourth quarter are expected to be slightly above the third-quarter level, while volumes are expected to be somewhat below due to seasonal fluctuations, Maersk said.
The Group's forecast for 2009 is still unchanged from its previous Interim Report 2009, which was negativein the order of USD 1 billion.
"The outlook for 2009 is still subject to uncertainty. Specific uncertainties relate to the development in container freight rates, transported volumes, the USD exchange rate and oil prices," Maersk added.
