Maersk Turns Profit Despite $300 Million Cost of Cyber Attack
Maersk Line posted a profit of $339 million in the second quarter of 2017, a much better result than the $151 million loss the carrier posted during in the same period last year.
This was the case despite the fact the carrier incurred an expense of an estimated at $200 million to $300 million combating the NotPetya virus that hit the company’s computer systems late in June. The actual financial impact of the virus will be felt primarily in the third quarter, but that did not stop Maersk from estimating it will turn a profit of $1 billion on the year, compared with the loss of $384 million in 2016.
A number of factors are contributing to this rosier picture. Maersk’s average freight rate per forty-foot equivalent unit (FEU) in the second quarter increased 22 percent, to $2,086. Rates on east-west trades did even better, seeing a spike of 36 percent. Revenue, at $6.1 billion was 21 percent higher than last year.
In a webcast presentation, Maersk Group CEO Soren Skou said, “What we are seeing are the strongest fundamentals for container shipping in quite a while.”
According to Skou, Maersk Line was averaging around 210,000 FEU a week at the time of the cyber attack, but liftings were cut to approximately 160,000 and 180,000 FEU in the first two weeks of July. Skou added that within a few weeks the numbers returned to pre-attack levels.
Maersk Line has “no ambition to gain a lot of market share this year,” said Skou, although the carrier had “used the price war to gain market share” in previous years.
Skou added that Maersk has no plans to order new ships tjis year or next, whether from the charter market or newbuild tonnage. Skou noted that Maersk Line’s acquisition of Hamburg Sud was “progressing as planned,” having now received approvals from 12 of the necessary 23 regulatory authorities. That transaction is expected to close toward the end of this year.
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