Moller-Maersk ups outlook as profit beats
Danish shipping group Moller-Maersk delivered a better-than-expected net profit Wednesday, raising its earnings outlook for the year on growth in Asia.
For its third quarter, net profit came in at 6.36 billion Danish krone ($1.15 billion), against estimates in a Dow Jones poll of 6.18 billion Danish krone. Revenue was 82.06 billion Danish krone, versus estimates of 80.87 billion Danish krone.
Moller-Maersk - the largest container shipper company in the world by the size of its fleet - said it now expected full-year net profit to be $3.5 billion versus earlier guidance of $3.3 billion.
"We forecast for the coming years around 5 percent as good growth in a year. So we don't think it will go much higher than this," CEO Nils Andersen told CNBC Wednesday. Andersen added that Asia was seeing good demand but Europe remained sluggish but stable.
He added that fourth-quarter results might be hit by low shipping rates at the start of the period, but 2014 should be a more profitable year with rates now seeing an increase.
(Read More: Moller-Maersk ups outlook as profit beats)
The container shipping sector has been dogged by overcapacity issues since the economic crisis while demand has also been in decline. To combat these two problems, Maersk took 21 percent of its ships on the Asia-Europe route out of service.
Despite an overall decline for the industry Moller-Maersk, which owns the global container division Maersk Line, has been surprising investors in recent quarters. In August, better-than-expected earnings led to the firm lifting its profit target for the year. It has also tried a series of strategies in recent months to try to stimulate the slight turnaround.
It launched the world's biggest container ship in September, the Maersk McKinney Moller, in a bid to help curb costs and be more effective in terms of fuel. It also teamed up with two other large ocean carriers—CMA CGM Group and Mediterranean Shipping—to form an "alliance" on the trade routes connecting the world's three biggest economic centers: North America, Europe and Asia.
Maersk with CMA CGA, based in France; and privately owned Mediterranean Shipping, based in Geneva, control about one-third of the world's shipping fleet, according to Drewry. The fourth largest is Taiwanese carrier Evergreen.
(Read More: Worst is over, but so are the glory days: Maersk CFO)
That means the carriers will share ships traveling on the Atlantic through the Suez and Panama canals into the Pacific. They will also share port facilities in transportation hubs from Shanghai to Los Angeles and New York, and on into Rotterdam, the Netherlands.
The so-called P3 alliance will give the three carriers control of about 43 percent of the Europe-Asia shipping market, 24 percent of the trans-Pacific, and 40 percent to 43 percent of the trans-Atlantic, according to figures cited by the Federal Maritime Commission, the U.S. agency that regulates ocean-shipping services.
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