COPENHAGEN: A.P. Moller-Maersk, the world’s biggest shipping firm, said the container business on which it is staking its future made a loss in the last three months as freight rates declined further.
Shares in the Danish company fell 9 percent after third quarter profit fell 44 percent and came in below forecasts. Low oil prices have depressed returns from the energy business which is the other main arm of the company.
The results underline the problems facing the family-controlled group which said in September it would focus its attention on building up its transport and logistics business, while creating a separate energy division.
The company stuck to its forecast for annual profit to be significantly below last year’s $3.1 billion.
“This is far from a satisfactory result for us,” said Soren Skou, who was appointed CEO of the group in June and still heads the container business.
“We grew more than the market and gained some market share in the third quarter,” said Skou, adding that Maersk managed to increase market share following the collapse of South Korea’s Hanjin Shipping.
However, Maersk said average freight rates fell 16 percent in the quarter to $1,811 per 40-foot container as overcapacity hurts shipping companies.
A net loss of $116 million for its container unit, against analysts’ expectations of a $174 million profit, shows the pressures as it seeks to remain the world’s leading container shipping carrier amid a wave of mergers and acquisitions.
Recent deals have involved China’s COSCO, France’s CMA CGM and Germany’s Hapag-Lloyd.
Japan’s top three shipping firms Kawasaki Kisen, Mitsui O.S.K. Lines and Nippon Yusen said on Monday they planned to combine their container shipping operations in a joint venture that will have $19 billion in combined revenues and control 7 percent of global container capacity.
Maersk has a market share of around 15 percent but has been unable to secure better prices for shipping goods.
“Everyone expected that rising spot freight rates after the Hanjin bankruptcy would start flowing into Maersk results quickly,” said Rahul Kapoor, analyst at Drewry in Singapore.
“But even as spot rates moved up, it didn’t show in the contract prices,” he said.
Net profit fell to $438 million for the three months to Sept. 30, below the $490 million expected by analysts in a Reuters poll.
Maersk, with a fleet of more than 600 ships, intends to develop its transport and logistics operations despite their problems, while creating a separate energy division combining Maersk Oil and three related companies.
The latter will be split from the main company individually or in combination “in the form of joint-ventures, mergers or listing,” within two years, the company said in September.
Maersk container business sinks to quarterly loss
Maersk container business sinks to quarterly loss
Bahrain still the only country with a ‘Data Embassy’ law in an AI-driven age, finance minister says
- He tells World Economic Forum his country developed regulations and infrastructure, invested in people and education to create fertile environment for entrepreneurs and foreign capital
- In terms of investment in people, Bahrain’s strategy in recent years has focused on the graduation of job creators alongside job seekers, he adds
DAVOS: Bahrain is the only country so far that has implemented a data-sovereignty law, as it lays the groundwork for startups in tech-driven market sectors, Sheikh Salman bin Khalifa Al-Khalifa, the country’s minister of finance and national economy, said at the World Economic Forum in Davos on Thursday.
The government has developed regulations and infrastructure for technologies, and invested in people and higher education to create a fertile environment for entrepreneurs and foreign capital, he added.
In 2018, Bahrain became the first country to implement a “Data Embassy” law that allows foreign institutions to store their data under the jurisdiction of their home countries while it is hosted by data centers in Bahrain.
This means, for example, that a German company’s data hosted in Bahrain is subject to German law and can only be accessed by other parties through a German court order, the minister explained.
“Bahrain has led the world in regulation,” he said. “We are, and continue to be, the only country in the world with a data sovereignty law … This is groundbreaking stuff. You need to have laws and regulations that are ahead, and a regulatory environment where it’s easy to do business.”
Also in 2018, Bahrain introduced a Bankruptcy Law that effectively decriminalized the failure of a business. Previously, entrepreneurs were held personally liable for a company’s failure and could face jail time.
“We had to work a lot with the Ministry of Industry and Commerce to decriminalize failure, because it used to be the case that if you had a failed company, you would end up having criminal action against you,” Al-Khalifa said.
“The Bankruptcy Law was a very important step in fostering a culture of entrepreneurship.”
The minister was speaking at the annual meeting of the World Economic Forum in Switzerland during a panel discussion on the ways in which governments can support entrepreneurship, improve soft skills and reduce bureaucracy.
He said Bahrain had also invested in infrastructure designed to support AI-driven industries and connect the country to the “global data highway,” more formally known as “South East Asia-Middle East-Western Europe 6” (SeaMeWe-6) which will run from Singapore, through the Middle East and Europe to Marseille in France via fiber-optic cable. It is set to start operating early this year.
In terms of investment in the workforce, Al-Khailfa said that Bahrain’s strategy has focused in recent years on the graduation of job creators alongside job seekers. The government has also organized startup weekends and monthly “pitching” competitions through which entrepreneurs can access funding for their ventures.
Authorities in the country have made entrepreneurial development a core component of economic planning, he said, with strong support at the highest levels of the government.
Last week, Bahrain’s crown prince, Salman bin Hamad Al-Khalifa, met representatives of 100 businesses, 15 of which were established in the past five years and each of which employed a significant portion of the national workforce in 2025.
“It is important that when you are graduating college students, you are really ensuring that entrepreneurship is there early, and that they’re graduating with an idea of starting a business early. Whether that business fails or succeeds matters less,” Al-Khailfa said.
“We are building a culture of entrepreneurship at a time when people are sharing ideas on a global level. An idea that’s good in Japan is good in South America and is good in Bahrain.”
