The Danish shipping giant A.P. Moller-Maersk said it projected a bigger annual profit in 2017 despite announcing last quarter numbers that were below forecasts.
A.P. Moller-Maersk, the world’s biggest shipping firm has struggled with the slowdown in world trade in recent years.
Maersk however, expressed confidence that its container shipping business will surge 2 to 4 percent this year as supply and demand are evening out.
The last quarter of last year was the first time in seven years when demand was greater than supply said the company.
The company experienced few new orders since July of 2015 and the bookings to build new ships is at its lowest point recorded.
The Baltic and International Maritime Council said that last year was projected to be the industry’s lowest level in more than two decades in terms of new shipbuilding contracts.
“I think the supply and demand fundamentals are looking reasonable now and for at least the first three quarters of this year,” said Maersk’s CEO Søren Skou who anticipates a $1 billion improvement in results this year.
Maersk’s gross revenues for last year amounted to $8.9 billion, falling short of the $9.5 billion forecast by industry experts. Earnings also missed forecasts by some $600 million, coming in at $1.5 billion leaving shares to fall by 6%.
Maersk will continue to consolidate and doesn’t expect any more new deals until it has completed the acquisition of the German container carrier Hamburg Süd, which it hopes to have cleared by regulators and settled by the second half of this year.
Skou also refused to elaborate on rumours about a potential sale of the company’s oil and gas operations in Brazil.
It was also formally disclosed that Board Chairman, Michael Pram Rasmussen is leaving at the end of March and Jim Hagemann Snabe will take his place.