Danish shipper Maersk :Profits plunge 40%

Danish shipping and petroleum group A.P. Moeller-Maersk posted Monday a sharp drop in 2011 net profit and warned that its transport unit expected a loss this year owing to excess capacity. Net profit last year fell by 43 percent to 15.19 billion kroner (2.04 billion euros, $2.73 billion), a statement said, owing in large part to "low container freight rates on especially the Asia-Europe trades." Fuel costs were higher meanwhile, and more than offset a slight 2.0-percent increase in sales to 322.52 billion kroner. For this year, the group forecast positive earnings "lower than the 2011 result" and warned that its shipping division "expects a negative result in 2012 as a consequence of excess capacity." The company's activities break down roughly into two units, Maersk Oil and Maersk Liner Business. The former expects a result that is significantly below the result for 2011 based on an expected 20 percent decline in oil and gas production at an average price of $105.00 per barrel, the statement said. In the fourth quarter of 2011, A.P. Moeller-Maersk recorded stable sales of 14.97 billion dollars, but said net profit was just one third of the level earned a year earlier, at 273 million dollars. Shares in the company sank in morning trades on the Copenhagen stock exchange, showing a loss of 2.8 percent.