UPDATE 1-Maersk to boost core units as containers stay volatile

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* Says to invest less in Maersk Line in the future * Says expects group return on capital exceeding 10 pct * Shares down 2 percent

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COPENHAGEN, Oct 9 (Reuters) - Danish oil and shipping groupA.P. Moller-Maersk said on Tuesday it is shiftinginvestment focus from its volatile container shipping unit toother core businesses to stabilise results and boost return oncapital.

Its container shipping unit Maersk Line swung back to profitin the second quarter but has for years been in the spotlightdue to falling freight rates and an oversupply of vessels, ascenario set to continue, it said.

The group's other core businesses Maersk Oil, APM Terminalsand Maersk Drilling, would in future increase their combinedshare of invested capital to up to 50 percent from currently 34percent.

Maersk Line's share of the group's invested capital would bereduced to a 25-30 percent range from currently 38 percent, thegroup said at its capital markets day on Tuesday, its first inthe company's 108-year history.

"We will aim for more stable results," Chief Executive NilsSmedegaard Andersen said, adding the group aimed to deliverreturn on invested capital of above 10 percent in five years.

"Today we see the group as a group of individualbusinesses," Andersen said.

Maersk Terminals and Maersk Drilling were expected tocontribute each $1 billion to the group's result within fiveyears, it said.

The units contributed $0.6 billion and $0.5 billionrespectively of the group's 18.1 billion profit last year, whileMaersk Line made a $0.6 billion crowns loss and Maersk Oil aprofit of $2.1 billion.

"It is going to continue to be a volatile business,"Andersen said, referring to its Maersk Line.

"We will continue to see vessel overcapacity for someyears," he said, adding the group would not excludeparticipating in consolidation, but that it was not currently apriority.

Shares in A.P. Moller-Maersk were down 2 percent at 1029 GMTagainst a 0.6 percent decline in the Copenhagen stock exchange'sbenchmark index .

(Reporting by Mette Fraende; Editing by Mike Nesbit)

((Copenhagen newsroom, tel: +45 33969649, e-mail:copenhagen.newsroom@thomsonreuters.com))

Keywords: MAERSK/